House of Lords: Director of Facilities
	 — 
	Question

Lord Lloyd of Berwick: To ask the Chairman of Committees whether he will reconsider the title of the newly-appointed post of Director of Facilities.

Lord Brabazon of Tara: My Lords, I am not persuaded that there is any need to change the title of Director of Facilities. It clearly and accurately describes the duties carried out by the post holder.

Lord Lloyd of Berwick: My Lords, I thank the noble Lord for that Answer. Nevertheless, does he not agree that Director of Facilities is a very poor description of the important job which Carl Woodall is doing and that we need something rather more imaginative? If the noble Lord himself lacks inspiration, will he consider asking Members of this House to suggest alternatives and perhaps offer a small prize for the winner?

Lord Brabazon of Tara: My Lords, I am not really persuaded by that argument. As I have said, the title describes very well the important job that the new Director of Facilities does. I know that the noble and learned Lord made various suggestions when we debated this the first time around, including Estates Bursar and things like that. But none of his suggestions would as accurately fit the bill as the title we have chosen. I should add that facilities management is now a well recognised profession. That describes exactly what Carl Woodall does.

Baroness Trumpington: My Lords, would the Chairman of Committees be surprised to know that to me a director of facilities means a lavatory attendant?

Lord Brabazon of Tara: My Lords, I thought that we might get something like that. I will just have to bring the noble Baroness up into the modern age.

Lord Shutt of Greetland: My Lords, I am sure that this title does seem a bit miserable. I am very much in sympathy with the noble and learned Lord asking the Question. If we were in a school, I am sure that we would be happy enough with the title of school caretaker. But this is a palace, so palace bursar has a far better ring about it. Does the noble Lord agree?

Lord Brabazon of Tara: My Lords, the problem with the use of the term "bursar" is that it would not accurately describe the responsibilities for finance. The responsibilities for finance are held by the finance director and the accounting officer, the Clerk of the Parliaments, and not the Director of Facilities.

Baroness Howarth of Breckland: My Lords, does the Chairman of Committees think that the name Black Rod describes the task of that post holder?

Lord Brabazon of Tara: My Lords, probably not precisely. However, it is a title that has been around for a very long time and I for one would not wish to change it.

Baroness Howe of Idlicote: My Lords, would the House be happy to know that whatever Carl Woodall's title is he has been of considerable help already in trying to find out whether the facilities for those who are hard of hearing around this House are adequate? So far, I think we have convinced him that they are not adequate. Therefore, I am hoping for great things from him and from those who command the resources of the House for putting the House into good repair.

Lord Brabazon of Tara: My Lords, we will do our best to meet those needs. However, I have to say that I have heard only good reports of the Director of Facilities since he has been in post.

Lord Roberts of Conwy: My Lords, if the Chairman of Committees is reduced in his choice of title, would it not be better simply to resort to the word "facilitator"?

Lord Brabazon of Tara: My Lords, the more suggestions I hear, the more convinced I am that we have got the right name at the moment.

Lord Pilkington of Oxenford: My Lords, when the Merovingian kings lost their power, they called the man with the real power "Mayor of the Palace". Why not use that title?

Lord Brabazon of Tara: My Lords, there might be others sitting near to where I am now who might rather have that title.

Lord Palmer: My Lords, despite the fact that the Chairman of Committees feels that he has chosen the best name, what about "Comptroller of the Palace of Westminster" or indeed "Comptroller of the House of Lords"?

Lord Brabazon of Tara: My Lords, that is a suggestion, but not everyone knows what it means, including me.

The Countess of Mar: My Lords, does the noble Lord agree that Carl Woodall was appointed as Director of Facilities and that he has made a flying start in carrying out his duties as he was required to do on his appointment?

Lord Brabazon of Tara: My Lords, I am glad that the noble Countess said that, and I think that that view is universally held.

Lord Filkin: My Lords, do noble Lords agree that we should move on to the next Question?

Noble Lords: Hear, hear!

EU: Lisbon Treaty
	 — 
	Question

Lord Howell of Guildford: To ask Her Majesty's Government what discussions they have held with the government of the Republic of Ireland on a second referendum on the Lisbon Treaty.

Baroness Kinnock of Holyhead: My Lords, the June European Council discussed and agreed the guarantees that the Irish Government wanted in order to address the concerns of the Irish people about the Lisbon treaty. The European Council conclusions say that the decision,
	"gives legal guarantee that certain matters of concern to the Irish people will be unaffected by the entry into force of the Treaty of Lisbon".
	Those guarantees do not change the Lisbon treaty; the European Council conclusions are very clear on them. The Lisbon treaty, as debated and decided by our Parliament, will not be changed and, on the basis of these guarantees, Ireland will proceed to have a second referendum in October.

Lord Howell of Guildford: My Lords, I thank the Minister for that reply. Again, I greet her and warmly welcome her to her role as Minister for Europe after her excellent maiden speech last night. I should like to ask her about the guarantees. She says that they are legal, but in fact they have no legal force at the moment. They would have to be incorporated into some future treaty if they are not to be incorporated into the Lisbon treaty. Can she explain how that process is going to work? Which treaty will they be put into and when will this occur? That information would help us a great deal.

Baroness Kinnock of Holyhead: My Lords, what we have in the guarantees will become binding in international law when the guarantees are translated into a protocol at the time of the next accession, which presumably will be when Croatia or Iceland comes in. Before that protocol can be ratified by the UK, Parliament must pass a Bill. As I said, Parliament will rightly have the final say.

Lord Tomlinson: My Lords, I welcome my noble friend to her new role and ask her a simple question. Does she agree that the role of the United Kingdom in relation to an Irish second referendum is to keep its nose right out of it and let the Irish people make their decision?

Baroness Kinnock of Holyhead: My Lords, I thank my noble friend for that helpful question and of course I can only agree. The point is that we have not pushed or pressed or bullied the Irish into this referendum, as some have suggested. They decided that it was a process that they wished to go through. They consulted and are consulting and, as I said, a referendum is to be held in October.

Lord Tebbit: My Lords, can the noble Baroness tell us when this Parliament will have an opportunity to debate and vote on the arrangements being made for the Republic of Ireland, which clearly have an effect on this kingdom?

Baroness Kinnock of Holyhead: My Lords, of course Parliament will have the opportunity to debate all the issues and the guarantees that I mentioned earlier. There is nothing in the guarantees that was not debated and discussed by Parliament. The guarantees that we have on taxation, on the rights of defence, in particular, and on the right to life were the key concerns and were discussed by Parliament and by others who have ratified the treaty.

Lord Dykes: My Lords, I endorse the warm welcome for the Minister in this, her first Question Time, and wish her well for the future. Is not this absolutely and totally a matter for the Irish people, unlike last time when there was huge outside interference from British and other Eurosceptics? Does she agree with me and an article in the Irish Times of 17 June that last time none of the consequences of rejecting the treaty was properly debated,
	"but they have been dramatically brought home to voters since then ... there has been a substantial shift ... to the Yes side since last autumn"?

Baroness Kinnock of Holyhead: My Lords, I thank the noble Lord for his important intervention. The European Union has listened carefully to the Irish people and has respected the position of the Governments and the parliaments of the countries that have ratified, too. That is an important point to make.

Lord Anderson of Swansea: My Lords, I give a warm croeso to my noble friend, who seems totally at home in your Lordships' House already. Will she confirm that there was in no way some sinister manoeuvre on the part of the European Union, but that this was a specific request by a sovereign Government—the Government of the Republic of Ireland—to which the Council of Ministers responded positively?

Baroness Kinnock of Holyhead: My Lords, I thank my noble friend. We were giving the Irish Government what they wanted, which was to address the concerns that people had about the Lisbon treaty. It is another important step towards bringing the treaty into force.

Lord Pearson of Rannoch: My Lords, I welcome the noble Baroness to her new position and, indeed, commiserate with it, but will she tell your Lordships, and through your Lordships' House the Irish people, what happens if there is not another accession treaty for Croatia, Iceland or any other country? What then is the position of what she calls the binding guarantees if they cannot be turned into protocols? Would she also be good enough to answer the question put by my noble friend Lord Tebbit, who asked whether your Lordships' House and the other place would be able not only to debate these binding arrangements and/or protocols, or whatever they come to be called, but to vote on them?

Baroness Kinnock of Holyhead: My Lords, it will remain as I said: the binding guarantees will be in place until such time as they are transferred and become part of the protocol. That is likely to be in the reasonably near future and the Irish are agreed that they are comfortable with it.

Lord Hannay of Chiswick: My Lords, will the noble Baroness accept from these Benches, too, our congratulations on her first appearance at Question Time? Does she not agree that it is slightly baffling that such a fuss is being made about this matter when—I think that I am right in saying this, but perhaps she will confirm it—the obligations that this House endorsed in the Lisbon treaty are not being changed by one iota? Also, as every one of the guarantees and clarifications given to the Irish are either neutral for us or beneficial to us by entrenching subsidiarity and by making it clear that the European Union does not have the right to alter company taxation, is it not a little odd that there is not more cheerfulness around?

Baroness Kinnock of Holyhead: My Lords, I agree very much with the noble Lord and thank him for his comments. What he says is true: there is nothing at all contained in the guarantees that we have not seen. As I understand it, noble Lords debated and discussed these issues for 25 days in Parliament, so they will be much more aware than I am of the detail that was gone into. I am surprised that some Members are not aware that everything in the guarantees has been agreed by the Parliament of this country.

Lord Lea of Crondall: My Lords, if and when the Irish people accept these new arrangements, does my noble friend agree that the logical advice for the Conservative Party to take, not to mention UKIP, is that often given by Denis Healey: when you are in a hole, stop digging?

Baroness Kinnock of Holyhead: My Lords, I thank the noble Lord. Again, I can only reiterate that there are issues that have been resolved by the summit undertaken by the Council of Ministers, at which our own Prime Minister was present, and all these matters were discussed and resolved on the basis of ensuring that the Irish Government felt that the concerns of the people of that country could be addressed. Nothing in the treaty will change and nothing in the guarantees will change the treaty as your Lordships agreed it.

Lord Stoddart of Swindon: My Lords, I, too, welcome the noble Baroness to this House and congratulate her on her ministerial appointment. I never thought, when I first met her in 1970, that at any time I would be addressing her as "the noble Baroness the Minister", but I am proud to be able to do so. To get back to the question—

Noble Lords: Hear, hear!

Lord Stoddart of Swindon: My Lords, would it not have been better if the Commission and the Council had accepted the Irish no and renegotiated the Lisbon treaty so that the guarantees that are now being given to the Irish could have been given to all of us?

Baroness Kinnock of Holyhead: My Lords, I did not expect to be addressing the noble Lord as a "noble Lord", either. I reiterate that no one in the other member states of the European Union undertook any bullying or cajoling of the Irish on this matter. It was decided that it was in the interests of Ireland to try to pursue the concerns that the Irish have about their position in the EU and that is exactly what they have done. Other member states have facilitated that in whichever way they can, but again I say that it is the business of the Irish; it is their concern, not that of anyone here. I am certainly not saying that it is our business to tell them what they think is good for them.

Iraq: Camp Ashraf
	 — 
	Question

Lord Eden of Winton: To ask Her Majesty's Government whether they have recently made representations to the governments of the United States and Iraq concerning the current threats to the inhabitants of Camp Ashraf in Northern Iraq.

Lord Brett: My Lords, the UK ambasssador to Baghdad called on the Iraqi Human Rights Minister, Widjan Salim, on 13 April this year to raise the issue of Camp Ashraf, and to remind her of the early assurances made by the Iraqi Government about the humane treatment of its residents. Officials at the British embassy in Baghdad continue to discuss Camp Ashraf with staff at the US embassy; the most recent discussion took place on 10 June 2009.

Lord Eden of Winton: My Lords, I am grateful for that Answer. I recognise that the Government have no wish to intervene in matters that are the concern of other countries, but given that the Government apparently now subscribe to the culture of "responsibility to protect", should we not be doing all that we can to avert a potential humanitarian catastrophe? What precisely were the assurances given by the Iraqi Government? Will it be made clear to Mr Maliki that international opinion will hold him accountable for the safety of the citizens of Ashraf?

Lord Brett: My Lords, the UK Government remain concerned that the fundamental human rights of all the residents of Camp Ashraf are fully observed. We particularly sought assurances from the Iraqi Government, who have given them—I now give the assurance that the noble Lord seeks—that no Ashraf residents will be forcibly transferred to a country where they have reason to fear persecution or where substantial grounds exist to believe that they would be tortured. We continue, as the noble Lord rightly says, to have no direct interest or control in this camp, but we continue to liaise with our colleagues in the United States, who are monitoring events with the Iraqi Government.

Lord Archer of Sandwell: My Lords, can my noble friend confirm that the citizens of Ashraf have been accorded protected person status under the fourth Geneva Convention, that the initial protecting power was the United States and that it cannot divest itself of its obligations simply by announcing that it has transferred them to the Iraqi Government? Given that the United Kingdom participated in the original invasion, have we expressed some of these concerns to our American allies?

Lord Brett: My Lords, the United Kingdom view is that the residents of Ashraf are not protected persons under the status provided by the fourth Geneva Convention. That ceased to apply in Iraq after 24 June 2004, the date of the end of hostilities and occupation. The United States Government have continued to grant protected persons status as a good-will gesture, but this is not granted through any legal obligation under international law, and the UN High Commissioner for Refugees has previously determined that Camp Ashraf residents do not qualify as refugees. However, the United Kingdom continues to take an interest to ensure that human rights are protected, as does the United States.

Lord Dholakia: My Lords, would the noble Lord accept the recent statement made by Mrs Rajavi in Paris calling for free and fair elections supervised by the United Nations? More importantly, is he aware of the intimidation of the inhabitants of Ashraf City? Would it not be right at this time to ensure that the European Union, Britain and America warn Iran that any harm, intimidation or persecution of those inhabitants will result in a reference to the International Criminal Court?

Lord Brett: My Lords, I have no knowledge of intimidation in the manner that the noble Lord suggests. If he has such evidence, I would be pleased to receive it and pass it to authorities which can take the matter further. It is a clear indication of the Government of Iraq's position that they have given assurances that no Ashraf residents will be forcibly transferred. That suggests that they are honouring their obligations. Our consular staff in Baghdad have talked to people in the camp and assure us that food and medicines are getting through, so there does not seem to be any lack of supply. However, I will happily take on board any evidence that the noble Lord has.

Lord Waddington: My Lords, would the noble Lord agree at least that Britain, being a party to the decision to hand over responsibility for Ashraf City to Iraq, now has some responsibility for recent developments and for the residents' safety? How on earth can it be right for the Iraqi authorities to blockade Ashraf City, refusing people the right to take in food, and demanding police access to the city while asserting that those living there have no rights whatever as citizens? Surely it is time that the British Government talked again to the Iraqi Government and reminded them of their responsibilities under international law.

Lord Brett: My Lords, I can but repeat the invitation I gave to the noble Lord, Lord Dholakia. If the noble Lord, Lord Waddington, has evidence of that nature to put forward, I will happily take it on board and ensure that the Foreign and Commonwealth Office can inquire into it.

Lord Maginnis of Drumglass: My Lords, I am surprised that the Minister is unaware of the fact that Camp Ashraf is in essence being besieged by the Iraq authorities. As someone who had grave reservations about the sacrifice that our soldiers made to achieve democracy in Iraq, I ask how we can allow those in Camp Ashraf, who have the same objective for Iran, to be harassed in the way they are. The Minister asks for evidence; he is in a better position to know the evidence of which the rest of us speak.

Lord Brett: My Lords, the answer is already in the noble Lord's question. Iraq is a democratic and independent sovereign state. The United Kingdom, and even the United States, which handed over control of the camp from 1 January, have to recognise that fact. However, that does not prevent us making representations, hence my invitation for any evidence.

Royal Mail
	 — 
	Question

Lord Hunt of Wirral: To ask Her Majesty's Government what are their latest plans to secure the future of the Royal Mail.

Lord Mandelson: My Lords, market conditions have made it impossible to conclude the process to identify a partner for the Royal Mail on terms that we can be confident would secure value for the taxpayer. There is therefore no prospect in current circumstances of achieving the objectives of the Postal Services Bill. When market conditions change, we will return to the issue. We remain convinced that Hooper's combined package offers the best chance of securing the universal postal service while protecting Royal Mail pensions.

Lord Hunt of Wirral: My Lords, in thanking the First Secretary of State and Lord President of Council for that statement, may I say that it is sad that, not for the first time, we have learnt of a major change in government policy not here in Parliament but through the media? By shoving this critical Postal Services Bill into cold storage to suit their short-term political ends, despite the Conservative Party still standing ready to help see it on to the statute book, does the Secretary of State not realise that he and his colleagues are putting the trustees of the Royal Mail pension plan in an impossible position given the revaluation that took place on 31 March last? What does he intend to do to restore confidence and certainty to everyone involved with the Royal Mail and its pension plan?

Lord Mandelson: My Lords, I can assure the noble Lord, Lord Hunt, that this House is the first to learn of this. Whatever spin may be put on any remarks that I make in an interview is a matter for the newspaper concerned. I take this opportunity to say to noble Lords that the time spent on the Postal Services Bill in this House has strengthened and improved it. I thank noble Lords for their contributions in Committee, on Report and at Third Reading which have helped to achieve that.
	We have thoroughly tested the market to see who is interested in partnership, but economic circumstances, I need hardly point out, are extremely difficult. I have always been clear that we would do a deal with the private sector only if it represented value for money for the taxpayer—indeed, I said so at Third Reading on 20 May. Our market testing has shown that now is not the time to sell a minority stake in Royal Mail. The pension remains a matter for the company and the pension trustees. The Government have been clear about the basis on which they would be prepared to take on the pensions deficit. They do not intend to cherry-pick the implementation of the Bill.

Lord Grocott: My Lords—

Lord Clarke of Hampstead: My Lords, given that the Secretary of State has paid tribute to the work done in this House in getting the Bill as far as it went, although there were many warnings about the climate of selling shares at that time, perhaps I may ask him two specific questions—he may have dealt with one of them, but I should like to be clear. Workers and management in the postal services country are living with uncertainty. My first question is: will the Secretary of State urgently get down to talking about the pension fund deficit? My second question is on the regulator. There was almost unanimity around this House about the unbalanced approach of Postcomm. That was clear; it is accepted. Will the Secretary of State now take steps to see that the yoke of Postcomm is removed and move Royal Mail over to a balanced and fair regulator?

Lord Mandelson: My Lords, as we discussed during the Bill's passage through this House, the pensions deficit is a huge and growing burden on the Royal Mail. Annual payments to pensioners in the plan currently run at around £1 billion. However, government have to be fair to taxpayers. They cannot expect them to take responsibility for the deficit if the other challenges facing Royal Mail are not also addressed. As I said, it would be irresponsible for the Government to cherry-pick implementation of the Bill. It would be irresponsible in respect of the taxpayer and impossible in respect of the European Commission, which would have to give state aid approval. As for the regulator, Postcomm will continue to regulate the postal market for the time being. It will not do so in a vacuum. Its powers will remain the same, but it will have to take full account of developments in the postal market, where volumes are falling at unprecedented levels.

Lord Skelmersdale: My Lords, would the Minister tell us when he expects the Bill to get Royal Assent?

Lord Mandelson: My Lords, as I have made clear from the beginning of my statement, market conditions have made it impossible to conclude the process to identify a partner on terms that would give value for money for the taxpayer. When market conditions change, as I said at the outset, we will return to the issue.

Lord Cotter: My Lords, I was going to say that we seem to have come half way up the hill and ask the Minister whether he was going to carry on or stay where he is. However, we now seem to be collapsing from the position that the Government put forward in support of the Bill. There are big issues—the Minister has spoken about pensions. The justification for the Bill was that it would allow the pensions issue within the European Union to be solved. There is an issue about modernisation, which the Minister talked about in the course of the Bill. Will that proceed? There is also concern about the post offices themselves; we hope that there will be some gains for them.

Lord Mandelson: My Lords, there will be no adverse impact on post offices, no. But the noble Lord is right: the need for modernisation in the Royal Mail has not gone away. We have heard from both management and the union that they are up for change; they have to put that rhetoric into action and it is time to see it being delivered. In the coming months, we will look for full delivery of the changes to Royal Mail's operations and working practices envisaged in the 2007 pay and modernisation agreement between the company and the unions. Endless industrial relations problems must stop in the Royal Mail, and we will look for evidence that there really is an appetite for modernisation in the company.

Financial Services and Markets Act 2000 (Regulated Activities) (Amendment)(No. 2) Order 2009

Link to Grand Committee Debate

Banking Act 2009 (Restriction of Partial Property Transfers) (Amendment) Order 2009

Link to Grand Committee Debate

Motions to Approve

Moved By Lord Myners
	That the orders laid before the House on 10 June be approved.
	Relevant documents: 17th and 18th Report from the Joint Committee on Statutory Instruments, considered in Grand Committee on 29 June.
	Motions agreed.

Transfer of Functions of the Consumer Credit Appeals Tribunal Order 2009

Link to Grand Committee Debate

Transfer of Functions (Estate Agents Appeals and Additional Scheduled Tribunal) Order 2009

Link to Grand Committee Debate

Transfer of Functions (Transport Tribunal and Appeal Panel) Order 2009

Link to Grand Committee Debate

Transfer of Functions of the Charity Tribunal Order 2009

Link to Grand Committee Debate

Rehabilitation of Offenders Act 1974 (Exceptions) (Amendment) (England and Wales) Order 2009

Link to Grand Committee Debate

Criminal Defence Service (Provisional Representation Orders) Regulations 2009

Link to Grand Committee Debate

Data Protection (Processing of Sensitive Personal Data) Order 2009

Link to Grand Committee Debate

Motions to Approve

Moved By Lord Tunnicliffe
	That the draft orders and regulations laid before the House on 1 and 10 June be approved.
	Relevant documents: 16th and 17th Reports from the Joint Committee on Statutory Instruments, considered in Grand Committee on 29 June.
	Motions agreed.

National Express East Coast Franchise
	 — 
	Statement

Lord Adonis: My Lords, with the leave of the House, I shall make a Statement about rail services on the east coast main line. The House will understand that because of the imperative for the Government to respond immediately to the trading statement made by National Express when the markets opened this morning, it was also essential for me to make a Written Ministerial Statement earlier.
	For some months now, National Express has been seeking to renegotiate the terms of the franchise agreement to operate services on the east coast main line between London, West Yorkshire, the north-east and Scotland which it signed in 2007. My position has been consistently clear—that the Government do not renegotiate rail franchises. That remains the position today. This morning, National Express Group announced that it will not provide the further financial support necessary to ensure that its subsidiary, National Express East Coast, remains solvent. As a consequence, National Express East Coast is no longer able to continue operations to the full term of its franchise, and expects to become insolvent later this year.
	The decision of National Express to break its contract is regrettable and disappointing. All other rail companies are fulfilling their contracts, despite the economic downturn. It is simply unacceptable to reap the benefits of contracts when times are good, only to walk away from them when times become more challenging.
	My first and overriding obligation in this situation is to ensure continuity of service to passengers, with no disruption or diminution of service standards. When the Government have had to step in to protect rail services in the past, there has been no such impact on passengers. I have therefore established a publicly owned company, which will take over this franchise from the point at which National Express East Coast ceases to operate.
	We will agree an orderly handover with National Express. Until that date, National Express will operate services on the current basis. After that date, the new public company will do so. There will be no interruption of services. Existing operational staff—who continue to provide a good service—will transfer to the new east coast main line company, so will the assets necessary for the continuation of the service. I can assure the travelling public that services will continue without disruption and all tickets will be honoured. I have today appointed Elaine Holt, until recently managing director of First Capital Connect, a major train operating company, as chief executive designate of the new east coast main line company.
	The failure of National Express East Coast obviously entails the loss of some future premium payments to which the company was contractually committed. However, while the franchise is under public control, the Government will receive the full revenues of a business which continues to make an operating profit. We will also gain the benefit of any premium payments from the new franchise once it is re-let. This represents a far better deal for the taxpayer than the only alternative course of action, which was to renegotiate the franchise in an exclusive manner with National Express, with no recourse to what is a highly competitive market for rail franchises. The cost of re-letting the franchise will be met from the performance bond of £32 million, to which the company is contractually bound in the event of termination.
	National Express also operates rail services on the East Anglia main line and associated commuter routes. The company has said that it does not intend to default on its obligations in respect of these franchises. Notwithstanding that, the Government believe they may have grounds to terminate these franchises, and we are exploring all options in the light of the group's statement this morning. In the mean time, we expect National Express to meet its obligations on these franchises in full.
	The department's procurement procedures test a company's track record and their ability to deliver a franchise and to demonstrate value for money in so doing. It would clearly be reasonable not to invite a company to bid for future franchises in circumstances where it had recently failed to deliver on a previous franchise. A company which had defaulted in the way National Express now intends would not have pre-qualified for any previous franchises let by the department. I note that the parent groups of previous franchise failures are no longer in the UK rail business.
	The Government intend to tender for a new east coast franchise operator from the end of 2010. The specification of the new franchise will reflect my concern to secure better passenger services and facilities. In particular, I will be seeking to secure significant further improvements to service quality, including to station security, bike and car parking facilities at stations, bus interchange facilities and train catering. This will ensure a step-change improvement for passengers from a new east coast franchise. I intend to consult fully on the new franchise specification, including with passenger groups, parliamentarians and the Scottish Executive.
	I have explained the action I have taken to ensure that passengers are not affected by the decision of National Express Group, and the consequences for that group of their decision.
	Let me also put these events in a wider context. No other train operator has defaulted on its franchise or indicated to us any intention to do so. Nor has any other company sought to renegotiate its franchise. Today's events do not represent the failure of the system, but the failure of one company. The rail franchising system was examined by the National Audit Office last year. It was found to deliver good value for money. The National Audit Office also concluded, and I quote:
	"The Department's arrangements for identifying and managing risks, including handling the failure of a train operator, are well planned and follow good practice".
	We are following that good practice in today's announcement, and I would welcome a further examination by the National Audit Office once the franchise is re-let.
	In respect of rail services at large, they are steadily improving. Passenger numbers are at their highest levels since the 1940s, punctuality is over 90 per cent and overall passenger satisfaction is rising, as shown in the latest independent National Passenger Survey, published yesterday. Moreover, the revenue from rail franchising is enabling us to make record investments in upgrading the network and services on it.
	We saw this as recently as last month in the award of the new South Central franchise for services on lines through south London, Surrey and Sussex. This was conducted during the recession yet yielded a winning franchise bidder—the existing operator—committed to paying a premium of £534 million to the taxpayer over nearly six years, in place of the previous contract under which the operator was subsidised by the taxpayer. This bodes well for future franchise awards, including for services on the east coast main line.

Earl Attlee: My Lords, I am grateful to the Secretary of State for making his Statement today. He has explained some of the background and I am sure that noble Lords will be grateful to him.
	During the Secretary of State's interview with Adam Shaw on the "Today" programme today, he said:
	"We have tried-and-tested procedures in place for taking over train operations when existing operators are unable to meet their commitments".
	He certainly does. In 2006 the east coast franchise was then known as GNER and it failed in far more favourable economic circumstances. The Government appear to have learnt nothing from the collapse of GNER and have continued to press train operators to make wildly optimistic bids. However, I accept that no one in 2007 expected to see such a big reduction in GDP.
	In the same programme, the Secretary of State said:
	"What we are dealing with here is a set of financial problems in the owning group, National Express, which have led to the departure of the Chief Executive today".
	However, is it not the case that the franchise agreement and the bid were based on a fixed and capped amount of parental support from National Express of about £70 million? If the DfT wanted more parental support then could it not have asked for it in the relevant tender documents? But, of course, any increase in parental support obligations would be reflected in a lower premium bid for the franchise. This is a profitable franchise route, so the operator generally pays the DfT for the right to run it.
	There has been much use of the word "default". What precisely is the default? What is its nature? NXEC has stated that it will run out of parental support provided in the franchise sometime later this year unless the economy picks up to an extraordinary extent. Has the Secretary of State detected any failure of operating performance by NXEC, the actual franchise, not National Express? Is NXEC meeting all its contractual obligations, and what part of the contract has been broken by National Express at this point?
	The key point is that taxpayers and rail users around the country will want to know whether Ministers appreciated when the DfT let this franchise that the operator's liability was capped; and is this desirable or not?
	I note that all tickets, including season tickets, will be honoured. That is extremely welcome, and the passengers have no need to worry on that score.
	In a previous exchange, the Secretary of State told us that there were cross-default provisions in the franchise agreements with National Express. But is it not the case that they only apply when the default on one franchise will have a material impact on other franchises within that group, and is there any evidence of this?
	In his Statement, the Secretary of State said that no other company has sought to renegotiate its franchise. What are the negotiations with Brian Souter and Stagecoach about?
	My final question is this. Does the Secretary of State really expect to be able to let a franchise on this route with another operator but at substantially the same terms as those obtained in 2007 when the economy was so very different?
	This is a very difficult problem for the Secretary of State to solve. He is in a Catch-22 situation. The fact of the matter is that less money is coming into the rail industry and he will have to work out what to do about it. If he renegotiates—which he does not want to do—he will open the floodgates; if he does not, he will face extra costs and loss of morale among the operating staff on the east coast line.

Lord Bradshaw: My Lords, I thank the Minister for making the Statement to us. I should chasten him on one or two points. The National Audit Office, from which he drew comfort, in its report on the franchising process ticked the boxes and said that the procedures had been followed. However, when I raised the policy issues behind the franchising process with the NAO, it said that policy issues were not a matter for it. What you have is an auditor's report with a lot of ticks in boxes; you do not have a fundamental review.
	Secondly, the south central franchise has new rolling stock, more rolling stock on order and is in a part of the country which is less affected by the recession. I am not surprised that there were reasonable bids for that franchise. However, it is time that we paused for reflection on the franchising service. This is not another Northern Rock situation whereby we will get the franchise back into the private sector and get some money in as quickly as we can. Nor is it a job licence for officials who now have no franchises to let, so they can spend a couple of years playing around with this one.
	Also, I take issue with the idea that there is the prospect of a highly competitive market. It will not be a highly competitive market. National Express's debt is £1.5 billion; First Group, which has been talking about bidding for the franchise, has a debt of £2.5 billion. Do we really want to let franchises to people who are basically without money behind them?
	For half the money that we invested in privatisation, we could have had the best railway in Europe. What we have is much more expensive compared with British Rail. I suggest that the Minister draws some professional experienced railwaymen into a debate about the future of the franchising process. I congratulate him on obtaining the services of Elaine Holt as chief executive and I can assure him that I can give him the names of a few more people who would do a damn sight better job than is being done now.
	I am sure that Her Majesty's Opposition as well as supporters of the Government would join in such a review. They must by now acknowledge the fact that privatisation was a tremendous mistake based on running down the railways. The focus, however, must be on what the passenger wants. I suggest that he wants clean trains with clean lavatories, sufficient accommodation and proper catering. These are very simple things which are often provided by very few well trained, low-paid extra staff—probably not the sort of people who are employed by lawyers, merchant bankers and consultants.
	What we need is a cheaper, less confrontational railway. The franchising system is not fit for purpose and a review is necessary. Network Rail has just appointed a new chairman and is reviewing the structure of that company. What could be a better time than to review the future of franchising at the same time and take out of the railway a lot of the internal and expensive disputes with which it is plagued?

Lord Adonis: My Lords, the noble Lord, Lord Bradshaw, is a distinguished former rail manager and I thought that he was going to volunteer himself to run the east coast main line. But for the fear of conflicts of interest, in this highly charged parliamentary atmosphere, he appeared to me to be a very well qualified candidate for the post.

Lord Bradshaw: My Lords, I thank the Minister for his compliment. I would do it for free.

Lord Adonis: My Lords, the appeal grows with every passing moment and I will certainly put him in touch with Elaine Holt. I share his high opinion of her; I got to know her when she was managing director of First Capital Connect, and she of course did a very good job there.
	The noble Lord asked me to reflect on the lessons of this experience, and I intend to do that. As the great Mr Gladstone said at the age of 82 as he was forming his fourth Administration, "I have been a learner all my life". At my very young age, I am certainly a learner. It is very important that we continue to learn from the experience of events such as the collapse of the National Express east coast franchise, and I will be learning. I am also very mindful of the noble Lord's point about seeing that we get a better contract specification. That is precisely why I do not intend to rush into re-letting the franchise. I could have simply re-let the existing franchise in a much shorter period than from now to September 2010, as indicated in my Statement. The reason why I want to take longer is to reflect on the experience, as the noble Lord recommended, and to improve the contract specification.
	I entirely share the noble Lord's concern to see that many of the nuts and bolts issues are addressed. I refer to better facilities at stations and better services on trains. I also know that among your Lordships the issue of catering on the east coast main line has been—how shall I put it?—a live issue over many months, and I intend to see that we have proper contract specifications in respect of catering. In addition, as part of my campaign to see that stations are much more amenable to cyclists, I want a great deal more bicycle parking at stations. I believe that this could be a very big growth market for the railways in the future. Therefore, I will be reflecting; I will not be rushing into a new franchise; and I hope that the next franchise that we let will be better than the previous one.
	The noble Earl, Lord Attlee, made a number of points with which I agree. I think that for the future we need to reflect further on the relationship between parent groups and special purpose vehicles. However, his fundamental point, which I know his party has been making during the day, is that the system is fundamentally broken. Perhaps I may say in parenthesis that this is a system that his party began. It involves the private sector, which I thought was a great cause of the Conservative Party, and it involves people bidding in market conditions for franchises. Therefore, I think that the noble Earl and his party need to be quite careful before they seek what many of my noble friends would like, which is to move back much more dramatically in favour of a publicly controlled and managed railway. I have sought, as I do on many of these issues, to see that we get the best of the private sector but ensure that it is properly regulated, as it must be when serving the public interest.
	I must address the suggestion which has been put out during the morning and which I regard as comical: that Ministers and my predecessors—presumably the noble Earl means predecessors on his side of the House too—press train operators to make, in his words, "wildly optimistic bids". He had the grace to concede that GDP had fallen significantly since. We are talking about people such as Brian Souter and Sir Moir Lockhead. Does he believe that they would respond to suggestions from me that they should raise their bids a bit and put aside their own commercial interests? I have never met anyone with a sharper sense of his own commercial interest than Brian Souter, and I respect him for that. That is why he is such a successful businessman and why he runs such a successful business. I know that there have been contractual issues, to which the noble Earl referred, in respect of South West Trains, but let us be clear why there are such issues. It is because Brian Souter knows exactly what his own commercial interest is, and of course he pursues it as relentlessly and as vigorously as he can. My job is to pursue the public interest as relentlessly and as vigorously as I can, and I hope that the House can rely on me to do that.
	This contract, which the noble Earl says was wildly optimistic in its bidding, was bid for by Richard Bowker, who was then the chief executive of National Express. Richard Bowker is a former chairman of the Strategic Rail Authority, so the idea that we had some ingénue who did not understand the rail market and was responding to a Minister of the day who was pressing him to bid higher than he wished to do comes from fantasy-land and does not help us through this issue at all. The reality is that we had 16 rail franchises and only one of them is in financial difficulty. None of the other operating groups has indicated to me either any intention to default or any likelihood of defaulting. Let us be clear that National Express will pay a financial penalty for leaving the franchise in the way in which it has indicated, and we will ensure that it meets its contractual commitments in full. National Express will pay a massive penalty in reputation for breaching its contracts with the Government.
	I said that we had previous experience, which I shall put in context. Since the process of rail franchising started, we have let a large number of contracts—41 to be precise. Of those 41, only two have failed until now. The franchise that we are discussing today might well fail, but of the two that have, neither of the owning groups responsible is now in the UK rail business. That is a sobering lesson to any other operator, including National Express, that chooses to go down the same path. It is a massive penalty.
	I shall end my remarks by referring to the National Audit Office. I am always guided by a proper and thorough analysis of public policy in the decisions that I take. The NAO, as the noble Lord, Lord Bradshaw, indicated, carried out a thorough review of the franchising system. I do not think that it is fair to say that it simply looked at procedural issues. It looked at substantive issues, and reached substantive judgments. It said:
	"The Department's approach to rail franchising produces generally well thought through service specifications and generates keen bidding competition. This approach has resulted in better value for money for the taxpayer on the eight franchises let since the Department took over from the SRA".
	It continues:
	"The Department's arrangements for identifying and managing risks, including handling the failure of a train operator, are well planned and follow good practice".
	I fully accept my public responsibilities to see that the train service is not interrupted and that we learn the lessons from previous experience in re-letting the franchise, but I do not accept that the fundamental policy is flawed. Never in the past 50 years have railways been in a better state in this country than they are today. They have an optimistic future. I am an optimist and I believe that we could construct the best railway system in Europe. We just have to have a mind to do so.

Lord Palmer: My Lords, I have three quick questions for clarification. The first concerns pensions for existing National Express staff, many of whom were ex-British Rail and then became staff of GNER. What will happen to their pension arrangements? I feel very strongly as I have known many of the employees quite well for the past 20 years.
	Secondly, how confident in reality is the Minister about re-letting the franchise? I have serious worries and doubts. Thirdly and finally, does he have any idea about, or will he look into what plans there might be, for those of us who have loyalty programmes with National Express? I have a serious amount of credits, and should be interested to know what will happen to them in the long term.

Lord Adonis: My Lords, I confess that in the hurly-burly of today, I have been unable to turn my mind to the issue of loyalty payments that the company makes, but I shall be glad to look into it.
	On pensions, I undertake that the terms and conditions of staff working for National Express East Coast will be fully protected as it transfers into the new public company. The staff will not lose out by the transfer. On the question of re-letting, as I said in my Statement, we have recently re-let an important contract—the South Central contract—for services from south London, Sussex and Surrey into central London. The noble Lord, Lord Bradshaw, said that this was somehow a special case. In fact, the range of bids for that contract was very wide indeed. As a result, we have moved from a franchise that was being subsidised by the taxpayer to a franchise operator agreeing to pay £534 million to the Government over five years and 10 months. It is not a new, fly-by-night merchant, but a solid, reliable and well established operator. Recent experience of rail franchising has been positive and gives us comfort for believing that we can have competition for the east coast main line, which is highly prestigious, and that we can get good value for the taxpayer. Experience of what happened to GNER after Sea Containers withdrew, and what happened with Connex, the south-eastern train operator, which could not continue in the rail business, shows that we had keen competition for the franchise thereafter.

Lord Clinton-Davis: My Lords, does my noble friend appreciate the possibility of the new publicly owned company proving a great success in running the railway line? Will he give an assurance that that situation can continue indefinitely?

Lord Adonis: My Lords, I do not believe that it would be in the public interest for us to have a nationalised train operating company indefinitely, as my noble friend suggests, because of our recent experience of rail franchising, which has, as the National Audit Office said, delivered good value to the taxpayer and keen competition from established, successful train operators. As I said, I see the situation in respect of National Express as exceptional. I do not see the system as flawed; we have had a problem with one operator that we have had to deal with. I believe that the public interest is best served by, in an orderly way, having learnt lessons from recent experience and, having improved the franchise specification, proceeding to re-let the franchise in due course.

Baroness Harris of Richmond: My Lords, the Secretary of State referred to the folding of the NXEC franchise as regrettable and disappointing. I would add, but not surprising. I have been a long-time critic of the way that that franchise has been run on the railway. I am very pleased to hear the Secretary of State say that the jobs of the onboard staff will be assured and safe. I suggest that one way to get a bit of money back would be to look at the senior management structure of National Express East Coast, because I can assure him that a great deal of money could be saved by getting rid of a lot of them.

Lord Adonis: My Lords, now that the noble Lord, Lord Bradshaw, will be working for free, we will be saving a great deal of money on the senior management structure. The noble Baroness's point is well taken. We will ensure that we have a lean management structure in the new company, that we do not pay beyond the going rate and that we get the best possible deal we can for the taxpayer.

Baroness O'Cathain: My Lords, first, it is very reassuring that the Government have been able to take such swift action without a whole lot of messing around and speculation in the press about what is going to happen. Did the Minister have any idea, or did anybody have any idea, that this was going to happen? Only yesterday, there was quite a large article about Mr Richard Bowker in the Times. I know that only because I was reading it at six o'clock this morning when I heard on the news that he had resigned. I thought, "Gosh, this is a great man, what has he done? He has resigned". Did that come completely out of the blue, or was a situation building up that no one took any notice of?
	Secondly, I am delighted that the South London franchise will yield £534 million over five years and 10 months, or whatever, but I say to the noble Lord, Lord Bradshaw, that the economic situation in the south-east and south London is no better than anywhere else in the country.

Lord Adonis: My Lords, I think that the noble Baroness's last point is well taken. In respect of prior warning, it is fair to say that National Express had made its concerns about the viability of its east coast operation clear to us over a number of months, but it was only in the immediate run-up to today and the trading statement that the company felt that it had to make on its half-year results that it told us firmly that it intended later in the year to default on its franchise commitments. By the way, the noble Earl asked me: what is the default? The default will be a failure to pay the premium payments to which the company is committed.

Lord Morris of Handsworth: My Lords, the Minister will be aware that National Express Group came into existence as a coaching company and employed a lot of drivers and other professionals. In the light of that, can he say what impact there will be on the coaching side of the business from the company's statement?

Lord Adonis: My Lords, I am not aware that the announcement made by the National Express Group today has any impact on the coach operation of the group. Its statement was solely in respect of its east coast rail business.
	Of course, I cannot speak for the company. My noble friend should approach it to ascertain whether it is intending to make any changes in respect of the coach business.

Viscount Tenby: My Lords, I shall say in passing that those who would like to put the clock back are by no means confined to noble Lords sitting behind the Secretary of State. In these straightened times for train operating companies, can the Secretary of State give an assurance that essential services to passengers will be continued and all economies by train operating companies, such as the closure of stations, ticket offices and cleansing services in stations, will be resisted at all times?

Lord Adonis: My Lords, I can give that assurance. All the essential services relating to the east coast main line will be maintained in full when the contract is under public management.

Baroness Maddock: My Lords, I welcome the Statement. As my noble friend said, some people who travel regularly—and I declare an interest as one of them—have been concerned about the east coast franchise. I particularly welcome the Secretary of State's comment that he will do his best to make sure that there is smooth running of the service. I was particularly interested in what he said about car parking. We have particular problems in Berwick-upon-Tweed with people reneging on promises. The Secretary of State knows about this because I have spoken to him about it.
	I am concerned that we get the franchising right this time, and I know the Secretary of State is interested in doing that. I hope that we do not rush it too much. I am still worried about the timescale the Secretary of State is talking about. I have raised with him the fact that in recent months there has been a lot of discussion in the press about the franchise. One of the things I picked up was the increase in passengers that National Express thought it would get to give it the money to pay the Government. When I looked at it, I had no idea where it would have put those passengers because the trains that we travel on are very crowded and there was no indication, in the short term anyway, that we were going to get new rolling stock. When the Government look at the franchise, will they please look at the passenger predictions because many of the trains, even now in the downturn, are very full? Putting 50 per cent more people on the present trains is impossible.

Lord Adonis: My Lords, the noble Baroness's points are well taken. As soon as she mentioned the word "car", I though she was going to ask me, yet again, about the dualling of the A1 north of Newcastle, which I know is a cause dear to her heart and to the heart of Sir Alan Beith. I entirely accept her point about seeing that we have adequate car parking at stations. If we want to get more people out of their cars and onto the train, which is high priority of mine, we have to see that they can park their car at the station without having to get there at the crack of dawn in order to get a space. As part of the contract specification, we will be looking at the adequacy of car parking at stations along the east coast main line and seeking to get significant improvements where appropriate.

Lord Foster of Bishop Auckland: My Lords, as a fellow lifelong learner but, more importantly, almost a lifelong traveller on the east coast line, I tell the Secretary of State that his Statement will be widely welcomed by passengers and staff on that line. Staff morale could not have been lower and the service was mediocre and deteriorating, so he has done the right thing. We hope that he will go on to achieve another, more successful, letting of the franchise.

Lord Adonis: My Lords, I am grateful to my noble friend who has huge experience of the railway industry and the services to the north-east. I appreciate his remarks.

Lord Bates: My Lords, does the Secretary of State agree that transport links are particularly important to peripheral regions, such as the north-east of England, and their economy? Is he aware that with the loss of flights between Durham Tees Valley airport and London Heathrow, another major link between the capital and the north-east of England has gone and, therefore, there is a potential worrying over-reliance upon rail? Would he support efforts to re-establish that link to Heathrow? Would the Minister also agree with the view of many of us that the heyday of the north-east railway service was the Great North Eastern Railway company operating a franchise very successfully for 11 years from 1996 under the previous Conservative Government?

Lord Adonis: My Lords, I know that GNER was widely admired for the services that it provided. I note that GNER put in a high bid in the last competition on the east coast main line. It is not correct to say that there was simply one operator that was way out ahead of the others, with them far behind. GNER was very anxious indeed to retain the franchise and bid hard to do so. Because, as the noble Lord so rightly says, of the excellent train service to the north-east and the view that operators had that it is possible to grow that market significantly, the market conditions of the time and growth projections have been attractive to many operators.
	I am happy to look at the issue of air services further, but I am afraid that there is no simple or straightforward answer.

Baroness Scott of Needham Market: My Lords, the Minister referred to the future of the East Anglian franchise in his Statement. Can he say a little more about the timing of such a review? Those of us who use the service regularly have already seen a marked deterioration in the quality of customer services. I fear that if a review takes a long time, they will have even less interest in maintaining a decent service while it is going on.

Lord Adonis: My Lords, my good friends, including noble Lords in the House, have made their views, particularly on the absence of the restaurant car on the line to Norwich, very clear to me. I know that there are concerns, although the punctuality of the service has been improving.
	On cost default, I am under an obligation to take account of the full circumstances of the case before the Secretary of State makes any decision. National Express's statement was of course only made this morning. I need to consider that statement very carefully with my legal advisers before I am in a position to make a judgment on it.

Lord Elystan-Morgan: My Lords, the course of action taken by Her Majesty's Government in this matter has been swift, prudent and practical. However, I raise a fairly narrow legal point. It has been said that the company is currently making an operational profit. It has also been said, of course, that insolvency looms large and will inevitably occur with the decision of the parent group not to give further financial sustenance. In those circumstances, does it not seem rather clear that fraudulent trading, a serious criminal offence under companies legislation, could well occur swiftly? Can the Government therefore give an undertaking that the pro tem successor authority will take over sooner rather than later?

Lord Adonis: My Lords, I am anxious on behalf of the Government to see that National Express's obligations are fulfilled. That is why we do not think that it would be prudent or in the public interest to seek to transfer the business from National Express East Coast to the public sector company until a point very close to the company ceasing to be solvent. However, I am mindful of the noble Lord's point, and we will be seeking to act co-operatively with the National Express group in deciding the precise date on which the transfer would take place.

Lord Snape: My Lords, I declare an interest as a former chairman of the bus division of the National Express and, alas, a shareholder in that unfortunate company. Does my noble friend accept that the responsibility for today's announcement lies entirely with the board of the National Express Group, and particularly with the, thankfully, outgoing chief executive, Mr Richard Bowker, who made what was described at the time as a "heroic" bid—some of us thought it was frankly insane—to take over the east coast main line in the first place? Fresh from wrecking the Strategic Rail Authority, he now has a train wreck of his own so far as the east coast main line is concerned. At the risk of making myself even less popular with some of my colleagues, I urge my noble friend to resist the calls somehow to recreate the golden age that supposedly was British Rail. I remind him that under British Rail Eastern Region, the east coast main line had half as many trains as it has at present, that civil servants, or supposedly Ministers, made the decisions in those days about investment in that line, and that those Ministers, in a Conservative Government as it happened—but I do not think that the situation would have been vastly different under my own party—regularly refused the then British Railways Board the right to borrow money in order to improve its services. Finally, when he re-lets this or any other franchise, will he look at proper, long-term franchises based on what passengers need and want rather that what the Treasury demands?

Lord Adonis: My Lords, my noble friend's remarks in respect of British Rail are well put. We all remember Jimmy Savile declaring in the 1970s that this was the age of the train, but, frankly, nobody really believed him at the time because the reality and the hype were so much at variance. However, rail services have improved dramatically over the past 10 to 15 years. Objectively, it is true that the public have more confidence in the railways because so many more members of the public are using them than was the case even a few years ago. My noble friend's remarks about the increased volume of trains are absolutely right too. The number of services running on the network is now higher than at any time since Beeching, so we have indeed improved not only the quality of services but the volume of services too, alongside increases in passenger numbers. Although much is splendid about our history as a country in respect of railways, as a Minister I want a better future not a better past.

The Lord Bishop of Chester: My Lords, I follow the previous question by pressing the Minister a little on whether it is necessarily in the public interest to let franchises to the highest bidder.

Lord Adonis: My Lords, a range of factors are taken into account in assessing the suitability of bidders to win franchises, including a necessary process of prequalification, under which prospective franchise operators need to demonstrate that they are fit to operate the railway and can meet the contract specifications, so it is not the case that only the price that they bid determines whether or not they are successful.

Lord Lyell: My Lords, those of us who live north of Berwick-on-Tweed, in Scotland, depend very much on this franchise—whatever it is called, Great GNER, or whatever. The noble Lord referred to rolling stock. Perhaps if he comes north of Edinburgh one day, he will find that in winter the scene on the trains is something akin to a scene in Dr Zhivago as sometimes the doors do not close and the windows are frozen. I hope that he will carry that in mind, but above all I am very gratified by what he said about staff pensions. I have always found the staff are extremely loyal. I spend 12 hours a week every week on this franchise. I hope that the noble Lord will keep supporting it and will see what he can do.

Lord Adonis: My Lords, I am glad to tell the noble Lord that on my great national rail tour I ventured north of Edinburgh and experienced the rail services there. That occurred at a very early hour of the morning. I am also glad to tell him that the windows were not unduly steamed up and that the doors were operating properly. I was impressed by the quality of service on offer. I entirely echo his remarks about the quality of the staff on the east coast main line who deliver the service day in, day out. I stand by them absolutely.

Policing and Crime Bill

Bill Main Page

Committee (2nd Day)

Clause 13 : Paying for sexual services of a prostitute subjected to force etc: England and Wales
	Amendment 45
	 Moved by Baroness Miller of Chilthorne Domer
	45: Clause 13, page 15, line 32, leave out from beginning to end of line 7 on page 16 and insert—
	"53A Paying for sexual services of a prostitute known to be trafficked or coerced: England and Wales
	(1) A person (A) commits an offence if—
	(a) A makes or promises payment for, or uses, the sexual services of prostitute (B), and
	(b) A knows, or ought to know—
	(i) that B is the victim of trafficking,
	(ii) that the sexual services have been provided through coercion of B,
	(iii) that B has provided sexual services in order to gain access to controlled drugs, or
	(iv) that a third party has influenced the activity of B by direction or instruction in circumstances where B does not freely consent to such direction or instruction.
	(2) It is irrelevant where the sexual services have been or will be provided.
	(3) In this section, "trafficking" means the recruitment, transportation, transfer, harbouring or receipt of persons, by means of the threat or use of force or other forms of coercion, of abduction, of fraud, of deception, of the abuse of power or of a position of vulnerability or of the giving or receiving of payments or benefits to achieve the consent of a person having control over another person, for the purpose of exploitation.
	(4) In this section, "coercion of B" includes—
	(a) violence against B or another person,
	(b) threats against B or another person, or
	(c) intimidation of B.""

Baroness Miller of Chilthorne Domer: With this amendment we move to Part 2 of the Bill, which deals with sexual offences and sex establishments. Before I discuss the detail of the amendment, I wish to mention a few points about our general approach to Part 2 and what we are trying to achieve with these amendments.
	The Government stated that their main aim in this part is to try to reform the law in this area to make it much more difficult to exploit trafficked women and much easier to catch the traffickers. However, we have worries that this part as drafted makes life much less safe for women sex workers, still allows child victims to be treated as criminals and puts clients in a position of automatic guilt. When we debated similar clauses under the Counter-Terrorism Act 2008 before the Government withdrew them, I urged the Government to assess New Zealand's approach of decriminalising prostitution. I am extremely dismayed that the Government have not examined that example in any detail, especially as the five-year evaluation of it shows so many positive outcomes. I feel that Her Majesty's Government have turned their back on that example and I would like to ask the Minister the reason for that.
	This part of the Bill could simply be seen as a moral crusade against sex workers and their clients. People have had these moral crusades for hundreds or even thousands of years. Meanwhile, the issues of the health of society and real routes out of prostitution for women who want that option remain unaddressed. We have amendments to address those issues. There have been those who claim that the Bill is a great move forward to stop women being treated as sex objects and to help rehabilitate prostitutes. Sadly, that is the view of some so-called feminists. I say "sadly" because normally I would be pleased to call myself a feminist, but in this case I believe that the approach is naive and takes no account of reality. It dangerously makes some women's lives less safe and more difficult.
	With those few opening remarks, I will turn to our first amendments, which would replace subsections (1) and (2) of new Section 53A of the Sexual Offences Act 2003 and Article 64A of the Sexual Offences (Northern Ireland) Order 2008. Government Amendments 55 and 64 will be consequential on our amendments. The effect would be to remove the strict liability offence for clients. We will come on to debate strict liability later under the amendments tabled by the noble Baroness, Lady Hanham, so I will not go into the detail of that yet.
	This amendment—whether we should have this clause at all is a question to which we will come later—would ensure that the definitions used are useful and accurate, and address what has made the woman behave against her will. I agree that the Government have clearly had doubts about their original drafting. Many doubts were expressed in the Commons, particularly by my noble friend Evan Harris who campaigned very hard on this issue. I am pleased that the Government have tabled their own amendments to this clause, which attempts to move in some direction on definition.
	I believe that our amendment is stronger. It changes the definition of the offence from one where a person has used force, deception or threats in the expectation of gain for themselves in order to induce or encourage a person to provide sexual services, and replaces it with an offence that stipulates that a prostitute must have been coerced, which it defines, does not freely consent or has been subject to the internationally recognised Palermo definition of trafficking.
	We believe that getting the drafting right at this stage is critical. If this Bill is to serve any purpose in stopping trafficking, those definitions and their use in court will be extremely important. We are anxious to have something that is of use for when traffickers are being prosecuted and, if this clause is included, a considerably tightened up definition. I beg to move.

Viscount Ullswater: I must advise your Lordships that if Amendment 45 is agreed I will not be able to call Amendments 46 to 53 because of pre-emption.

Baroness Hanham: I thank the noble Baroness for tabling this amendment. It covers many of our concerns about this clause, and as she has said, there are many questions about it. I am also glad that the noble Baroness indicated that she is quite happy to confine some of them to the appropriate amendments that are to follow: that is, questions on the strict liability issue. Given that, I shall leave my remarks on strict liability and the precise definition of exploitative behaviour covered by the government amendment, along with the level of offences, until we reach the relevant groups.
	I shall concentrate instead on whether a new offence of paying for the sexual services of a prostitute subjected to force adds anything to the Government's wider policy of reducing human trafficking and prosecuting those who engage in it. None of us would disagree that the trafficking of human beings is a grievous crime and that the Government need to do everything they can to ensure that the enforcement agencies engaged in tracking and prosecuting those who promote it can do so expeditiously, and that they do then take action, particularly when they believe or have reason to believe that people are being forced into prostitution as a result. We know that the figures for those being forced into prostitution are ridiculously high.
	It is appalling that the United Kingdom remains classified by the United Nations as a high-level destination country for trafficking and that women and children are still being lured here, often under false pretences, in the belief that they are coming to do worthwhile work, but are ending up being exploited. Despite endless legislation to deal with the matter—we had the Serious Crime Bill just recently—only a small number of prosecutions takes place. It is also unfortunate that when faced with evidence that human trafficking is still growing, all the Government can do is to add an offence that would result in a level 3 fine.
	We have been calling for a wholesale review of the legislation surrounding prostitution and the various associated offences, particularly that of trafficking, because there is a great deal of it. However, this Bill does not review it. Sadly, it represents yet another missed opportunity. Neither this offence nor the various other tweaks and adjustments in the clause will do anything much to help those trapped in prostitution to find a way out or to bring those profiting from it to justice. A wealth of offences dealing with trafficking and exploitative prostitution is already on the statute book, so the Government must look hard at the reasons why these offences are not working. The statistics on the number of women and children trafficked into this country provide damning evidence that not only have this Government lost control of immigration, but that much more must be done to catch traffickers and their victims at our borders. The prosecution figures are also extremely disheartening. Despite the thousands estimated to be trafficked for sexual exploitation, the number of convictions has never risen above 40 a year, and with the exception of a few notable cases, sentences have been far lower than the legislation allows for.
	The challenges of bringing a case to a successful prosecution are considerable, and the international element often imposes long, frustrating delays and raises the costs. The offences we have in place are pretty clear, but the nature of the crime makes it hard for victims to come forward. This is important because they are isolated from the enforcement agencies not only as a result of their fear of reprisals from those who are pimping them, but because of their fear of prosecution or deportation. We do not oppose this new offence as such because those providing human traffickers with a lucrative market must bear their share of responsibility for the suffering that is caused. However, like the noble Baroness, I have strong reservations about whether the offence as drafted will make the difference the Government appear to be hoping for. Indeed, there is a danger that it will do the exact opposite of what is intended.
	The debates in another place suggest that the Government are hoping that by focusing on the demand side of the equation, more can be done to reduce the industry than is currently possible by attacking the supply. I am extremely sceptical of this assumption. For one thing, those who are trafficking these often young and extremely vulnerable women are perpetrating one of the worst crimes prevalent in our society, and I hope that this new offence does not in any way indicate that the Government have given up trying to catch and successfully prosecute the traffickers.
	With scarce resources, enforcement of any new offence runs the risk of diverting attention away from the investigation of existing offences. As it is impossible that the new offence could be committed without the existence of the person referred to as person C in the legislation, I hope the Minister can assure me that it would, if agreed, be used only in conjunction with police efforts to track down, arrest and imprison the traffickers.
	I support the amendment moved by the noble Baroness, Lady Miller. As I say, we will come to the question of strict liability on my next amendment.

The Earl of Onslow: I support the noble Baroness because of the failed version of the absolute offence produced in the original Bill. Obviously, prostitution has gone on for ever and ever. Herodotus talks about the temples of Babylon and there is a wonderful quote from Gibbon, which I shall not repeat because it might be regarded as offensive to those of the Roman Catholic faith; it refers to the activities of a rather early mediaeval Pope.
	In the JCHR report on the Bill, we state:
	"We welcome any initiative aimed at protecting the rights of those who are trafficked for the purposes of sexual exploitation, or who are otherwise engaged in sex work without their consent... However, we question whether the precise methods chosen by the Government meet its positive human rights obligations and we are concerned that they run the real risk of making those engaged in prostitution even more vulnerable".
	In the human trafficking report we produced in 2005-06, we say of human trafficking that it is,
	"the slave trade by another name".
	Therefore, above all, we have got to catch those who are indulging in it. That means, surely, that we have to be as tolerant as we possibly can be towards the women who are exploited by making sure that their life is made easy and that they can report it to the police without fear. The proposed new clause will make it easier for a client who may come to suspect that a woman is trafficked to go to the police.
	This is an improvement on the proposal put forward by the Government. I do not for one moment expect it to be regarded as perfect but it is a small advance in a totally age-old problem. The mechanics of exploitation seem to be more advanced than they were in the days of that Maltese gang, the name of which I cannot remember, in the 1950s, whose members were successfully prosecuted, convicted and sent to prison for very long terms. We need the ability for that to happen now because, as my noble friend said, this country is one of the most lucrative markets for trafficking. I obviously support the amendment because I have put my name to it, but that is the attitude we ought to take over the whole issue.

Lord Judd: The noble Earl has emphasised that he has put his name to the amendment and that is greatly to his credit. During my time on the Joint Committee on Human Rights, when we were taking evidence on these issues, I do not think that any of us, irrespective of party, was anything but deeply disturbed and moved by what we heard. The evidence came from dedicated voluntary organisations and others working with the victims and from some of the police who were specialising in this area. One of the things that impressed me was how deep the concern of the police carrying this responsibility became about the nature of the situation with which they were dealing and the women involved.
	I congratulate the noble Baroness, Lady Hanham, on the vigour and strength with which she put her case. I thought it was very impressive.
	We must never forget that these women are victims. That is what the police, to whom I just referred, kept emphasising when we were taking evidence for the Joint Committee on Human Rights: that they were dealing with victims. If they are dealing with victims of a cruel trade, it is essential to concentrate on trying to deal with the wicked criminals who conduct it.
	I want to say one more thing about the issues raised by the amendment. I am afraid—I use that word advisedly—that there is a big educational task to be undertaken in this country. It is important that as many people as possible understand what is really happening, and what the implications are of the services being provided. It is nothing but helpful, therefore, to have in the Bill as much explicit information as possible about what trafficking and coercion really mean, to enable the public to understand their responsibilities if they decide to indulge in prostitution.
	I congratulate my noble friends in government on having grappled with this issue and raised it in the Bill. At this stage of our deliberations, I urge them to listen carefully to the amendments, the grounds on which they are put forward and indeed the strength and conviction with which that is being done, and to see whether, before we bring the Bill to a conclusion, there is some way in which they can meet the arguments that have been deployed.

Baroness Butler-Sloss: I declare an interest as a vice-chairman of the All-Party Parliamentary Group on Trafficking of Women and Children. I heard from the Director of Public Prosecutions on Monday—the noble Baroness, Lady Hanham, may be relieved to hear this—that over the past three or four years there has been an increase in the number of prosecutions, in the number of convictions and, just recently, in heavier sentences. It looks as though the CPS is going the right way and finding more and more people to prosecute.
	I have doubts about the effectiveness of both the Government's clause and the variety of amendments that have been put forward. If there are to be amendments, I choose to support the noble Baroness, Lady Miller, but I say that there are doubts because there could be important unintended consequences.
	If the Committee will bear with me, I will tell the story of a Czech girl trained by her mother to be a masseuse, a girl of the utmost propriety who was brought here in the belief that she was going to a genuine massage parlour—not the sort of parlour that we in England would understand it to be. She found herself in a brothel in Totnes in Devon. She was there for a week, a girl with no experience, and I believe that there were 12 men on the first night. One has just to think what that must have been like for an inexperienced, decent girl. On the fifth, seventh or eighth day she was taken to the local pub, where she very bravely made a huge scene. The police were called, and they looked after her. She was returned to her home in the Czech Republic and to her perfectly respectable mother.
	The police take time to get evidence internationally. The way in which the questions are asked is a nightmare for the CPS and for anyone engaged in these trials; it takes months, sometimes years, for the evidence to be available to prosecute. So what did the police do? In this case, they prosecuted these people as brothel-keepers and got them convicted. Why? Because some of the men whom this girl serviced, or who were good enough not to make her do that, were so shocked by her story that they came forward and gave evidence against the brothel-keepers, who are now serving sentences of imprisonment. Would they do that if they were to become part of the criminal population for having had sex with someone who they knew, or ought to have known, had been trafficked? That is a really quite dangerous unintended consequence. If this clause goes through, amended or unamended, something will have to be done to protect those men prepared to come forward to help trafficked girls and to catch brothel-keepers. I am glad to say that the police are now going to prosecute them as traffickers, but that will be a long-drawn-out prosecution. However, I offer this example to the House as a problem about criminalising those who pay for sex.

Lord Waddington: I find myself somewhat out of step, I fear, with my noble friends, although I do not think it will cause them much loss of sleep. Clause 13 has attracted great criticism, which is hardly surprising. On the face of it, it seems strange that paying for sex may or may not be criminal, depending on circumstances which cannot be known to the payer. In reality, it would be quite impossible for the would-be payer—the customer—to ascertain whether a third person has used force, deception or threats to encourage the woman to provide sexual services. Having said that, I am not greatly attracted by Amendment 45. Surely it would be almost impossible for the prosecution to prove both that the woman had been trafficked and that the man knew, or ought to have known, that the woman had been trafficked or that her sexual services had been provided through coercion, still less that the woman was doing what she was doing in order to gain access to drugs. Not to put too fine a point on it, in my view there is not the slightest doubt that the amendment would render Clause 13 completely useless.
	I find it difficult to see how men could complain if it was simply made an offence to pay for the services of a prostitute. Some prostitution would be forced off the streets while the girls continued to work in brothels, but surely it is likely that with the threat of prosecution hanging over those seeking the services of prostitutes, demand for the services of prostitutes would fall overall, and that would mean fewer people being forced into prostitution. It could cause hardship to women down on their luck who, under no pressure from any particular person, want to offer their services, but the Government's proposal, through its deterrent effect, would also hit such women.
	A complete ban on paying prostitutes for sex might save some women from themselves. After all, there is little doubt that even those not forced into prostitution tend, once in that way of life, to fall into the hands of evil people. They are often then the victims of rape; they suffer physical violence from customers and from those who have set themselves up as their protectors; and a very high proportion turn to drugs to help face the hazards of a life in which they have become trapped.
	It seems obvious that if in this country demand for the services of prostitutes was reduced, there would also be a reduction in the number of women being brought from abroad to work in British brothels. Surveys suggest that a total of about 80,000 prostitutes may be working in Britain, of whom perhaps a quarter have come here as a result of the activities of traffickers. So it surely follows that a reduction in demand will help to reduce human misery.
	Finally, it is sometimes said that the best way to proceed is to have official regulation of prostitution, it being asserted that if the trade were properly regulated women would be better protected. But the experience of the Netherlands and Australia suggests that it would be impossible to make regulations 100 per cent effective and we would finish up with a regulated market alongside an unregulated market.
	However, all this is pretty academic. Regulation is no more on offer today than is a complete ban. What is on offer is Clause 13. Since I feel that we have to try to do something, I am tempted to vote with the Government in spite of the obvious and justified criticisms of the clause and the justified fear that to create such a strict liability offence might be an unfortunate precedent. However, I am anxious to hear what other noble Lords have to say on the matter.

Lord Desai: I support Amendment 45. I apologise to the Committee. I did not take part in the Second Reading debate. We know that trafficking is bad. It deals with a supply of women who go into the sexual services business. The answer seems to be that if we reduce demand, something will automatically happen to the supply, leading to a reduction in the number of women offering sexual services and, therefore, in trafficking. I am laying all this out because there are links in the chain which do not work.
	If it were a question of drugs, there would be a straightforward connection between the person demanding drugs and the person supplying them, but, here, there is an intermediate human being who becomes the service provider: the woman. The clause implies that almost everyone supplying sexual services is somehow forced into it by the traffickers. It is essential to understand that there are women who provide sexual services either voluntarily, because of various circumstances which I do not have time to go into, or because they are trafficked. If you confuse the two and reduce demand, you are as likely to drive away the women who are voluntarily there and you will not do much to reduce trafficking. All that will happen if the price falls is that more ruthless and efficient suppliers will drive away the voluntary, one-person or two-person providers. You might therefore be just as likely to strengthen the traffickers. These sorts of perverse effects—or unintended consequences, as the noble Baroness pointed to in another context—are well known in economics.
	We should therefore be careful in believing that just because we cut demand for a service, we necessarily get rid of its supply, especially that part of the supply which is more odious. The amendment of the noble Baroness is an attempt to discriminate between those women who provide sexual services voluntarily and those who have been forced into it. It is a difficult distinction, but we should make some attempt to make it, otherwise we shall punish the women who do not deserve to be punished as having been trafficked.

The Lord Bishop of Chester: The noble Baroness, Lady Miller, suggested that some of those who support the Government on this matter are engaged on a moral crusade, which I hope cannot be necessarily rejected outright. However, I do not think that those who, like me, start out by supporting the Government do so primarily out of a sense of moral crusade, although moral issues are raised even where money is paid for sex where there is consent on both sides. Where the law intrudes into moral issues of this kind is always a difficult issue.
	However, in the background is the inexorable growth in prostitution in our country, for which the figures are alarming. Also in the background is the increased sexualisation of our culture and of children in particular at an ever younger age. The difficulty with that is not only that children are involved but that the sexualisation of our culture is very much in male terms. At the end of the day, it is very much a male view of prostitution that tends to be in the frame, in the background. There are figures for sexually transmitted diseases, for births to teenage mothers, on the level of abortion and so on. That is a difficult background, and it is understandable that the Government want to bear down on a particular aspect of prostitution, which has grown in an alarming way. As I understand it, about 80 per cent of active prostitutes in London come from abroad; not all of them are trafficked, of course, but a significant proportion are. We heard a horrific story about that from the noble and learned Baroness, Lady Butler-Sloss—and we think of the absolute trauma involved.
	I approach this matter not on the basis of a moral view that I have but simply on the basis of how you protect women in our society. A key issue is how we frame the law around prostitution to give the maximum protection to women in our society. I suspect that there will be other aspects of this that will have to come back to this House in future. This Bill deals with a particular aspect—the issue of trafficking—because there has been a growth in that crime, and a growth in the number of young women has been instanced to us. If we are to change the law in this area, it must be kept as simple as possible, and we should not allow too many other issues to come in. Therefore, I am slightly concerned with Amendment 45, partly because of the link made with drug-taking. I am told that 95 per cent of street prostitutes do what they do to fund a drug habit, so in one sense anyone engaging a prostitute for money should know that there is likely to be a link with drugs. However, that is a separate issue from the one that the Government want to bring forth.
	I say that this matter should be as simple as possible—and that will be the issue to discuss in the next set of debates on strict liability—so I shall not say any more now, other than that there are real issues of the protection of women in our society.

The Earl of Onslow: I would not like the right reverend Prelate to think that when supporting the amendment I did not take exactly the same view that he takes over reducing the damage done to trafficked women. That is exactly the point. We are all in agreement on the aim; some of us believe that the method by which the Government are attempting to get there will do more harm than good. That is why I put my name to the amendment—but I agree totally with the moral point that the right reverend Prelate makes.

The Lord Bishop of Chester: I am grateful to the noble Earl for his agreement. I think that the issue will emerge more sharply in the next debate, on the issue of strict liability. It is right for the Government to keep their parameters as narrow and focused as possible on the particular issue of the use of trafficking, because that is where there has been this alarming growth—and particularly in the abuse of young girls through the process.

Lord Pearson of Rannoch: I, too, apologise for intervening when I did not speak at Second Reading. However, a question has since been put to me on this part of the Bill that I have not yet heard raised in our proceedings, although the noble Baroness, Lady Hanham, alluded to part of it in her remarks on this amendment when she said that she hoped that the Bill would not reduce police attempts to address traffickers and controllers of these very unfortunate women.
	As I understand it, the Bill creates a new offence if a client visits a prostitute whom he knows, or should know, has been trafficked or otherwise forced into prostitution, even if in fact he may not know of her circumstances. The question is very simple: if the police are sufficiently aware of the prostitute's circumstances to arrest the client, why do they not instead arrest the traffickers or the people who have forced the girl into prostitution? Surely the police have to say to the client that they know the unfortunate girl's circumstances well enough to arrest him and that he must also know them, or he should. If the police are not in possession of the necessary facts, how can they successfully prosecute the client? If they are, why do they not instead arrest the traffickers or their agents in this country, or whoever coerced her in the first place and who therefore set up the circumstances in which they intend to arrest the client?
	I hope noble Lords will forgive me if that is a somewhat stupid question from someone who has not followed the finer points of the Bill. I look forward to the Minister's reply in due course.

Baroness Stern: I, too, have my name on the amendment. I am very glad that, despite the number of noble Lords who have spoken and the amount of wisdom that has been expressed, there are one or two things left that I might say. A number of noble Lords who spoke at Second Reading made the point that social problems are rarely solved by law enforcement measures and that when they are it is usually only for the short term.
	I will speak generally to the relevant clauses in the Bill before I come to the specific amendment to which my name is attached. Law enforcement in this case could leave the social evil untouched and make the situation worse. I am extremely grateful to the noble Lord, Lord Desai, who explained much better than I could have done, the basic economics of a market and how it will not respond in the way that it is expected to by people passing laws.
	There is absolutely no doubt, as noble Lords have said, that many social evils are associated with prostitution, such as exploitation, trafficking, untreated health conditions, violence, the danger of assault and murder as well as the degradation of neighbourhoods by bringing in activities that are extremely unpleasant for those who have to live there. I am sure that all those who live in such neighbourhoods would like a successful solution to those problems and that all those who work in the sex industry would like to be protected from the violence and the dangers to their health.
	When confronted with this range of issues, from human trafficking to problems in neighbourhoods to serious health and violence problems, one must ask how the Government came up with the big idea of reducing demand for prostitution through the criminal law. The Government's paper Tackling the Demand for Prostitution said:
	"So far ... little attention has been focused on the sex buyer, the person responsible for creating the demand for prostitution markets. And it is time for that to change".
	Can the Minister shed some light on why it is now time for that to change? What else was tried before it was decided that the best way of dealing with the undoubted problems was to try to tackle demand? Is there evidence, apart from the disputed information from Sweden? Are the Government convinced that they will not make the lives of many of these vulnerable people more risky and more miserable?
	The Minister will be aware that at Second Reading the noble Lord, Lord Faulkner, who has since been given a governmental appointment, said that this was a,
	"wholly misguided attempt to criminalise the clients of prostitutes ... Many commentators and academics, as well as police officers, take the view, and I agree with them, that criminalising clients drives prostitution underground and increases the dangers that women sex workers face".—[Official Report, 3/6/09; col. 273.]
	The amendment to which my name has been added attempts to improve what is basically an untenable position. I was very glad to add my name. I also support very much the approach taken by the noble Baroness, Lady Hanham, and her remarks on the need for a much more thoughtful and scientifically based approach to two issues—one is human trafficking and the other is street prostitution; the two things are not the same—and an approach that can rescue those who have been trafficked while also protecting those who face the dangers of street sex work.

Lord Blackwell: I intervene briefly simply to ask the Minister to clarify one point. It is clear listening to this debate that these are very difficult issues. I wonder whether he can clarify the intent behind subsection (2)(b) of new Section 53A. This provision states that it is irrelevant,
	"whether A is, or ought to be, aware that C has used force, deception or threats".
	It seems to me that the way in which that is drafted is tantamount to saying that A, in procuring the services of a prostitute, is in almost all circumstances facing the threat of prosecution. In other words it is tantamount to making the procurement of a prostitute an illegal act, because unless anyone who does so is absolutely certain of the opposite, they face the threat of prosecution. I therefore ask the Minister to clarify whether the purpose of the clause as drafted is in effect to make prostitution in normal circumstances illegal. Or is there some other purpose or intent behind the way in which the clause has been drafted?

Baroness Howe of Idlicote: I apologise that I was not able to take part in the debate on Second Reading. However, I have followed the issue for some time and I have received all the briefings that your Lordships have received.
	I support the amendment moved by the noble Baroness, Lady Miller. Like my noble friend Lady Stern, I was also very pleased to hear what the noble Baroness, Lady Hanham, said about her amendment. I was among those who on previous occasions expressed the view taken by the noble Lord, Lord Faulkner—who is now rather prohibited from making any comments on this subject in view of his appointment, on which we all congratulate him. The issue that should be concentrated on more than any other is that the trafficking should be stopped much earlier, at the borders, as we have discussed in relation to other Bills. It should even be stopped on the other side, in the country from which they are trafficked. We also have to bear very much in mind that the majority of those doing the trafficking are outside this country and face absolutely no penalty as a result of what they are doing. Some time ago I visited Downview prison and was made well aware of that point by talking to the many women there who had been trafficked. I will not go into the stories but they were fairly horrendous.
	It is good to know, as my noble and learned friend Lady Butler-Sloss has reported, that the number of prosecutions is increasing. However, I simply cannot believe that we will improve the situation for the women themselves by creating this extra offence, so I very much support the amendment. It may not be perfect, but we hope that it will, together with what went on in the other place, persuade Ministers to think again about the subject.

Lord Pearson of Rannoch: Perhaps I may ask the noble Baroness for clarification, because of my ignorance. She says that most of the trafficking takes place outside this country, which is of course true for those who capture these unfortunate women in the first place. However, when these women have been captured and brought into this country, there must be agents of those external traffickers who continue the work of controlling and supplying them. Surely it is those people whom our police should, in the first instance, be observing, arresting and controlling, especially as they have ample communications with police overseas. Does the noble Baroness agree?

Baroness Howe of Idlicote: Of course there must be contacts at this end. I would not deny that for a moment. However, I am also saying that for those who are outside and are part of a ring, our police should pay a lot of attention to trying to find these partners in crime. That does not lessen the efforts that we should make to stop the women coming over in the first place.

Lord Lucas: The position expressed by my noble friend Lord Waddington, which is that we should legislate to outlaw paying for sex, is entirely honest. When the Government started from that position—indeed, it sounded as if that was the position that they wanted to take—I thought that we were going to have an honest debate. I may not agree with that position—in fact, I do not agree with it—but it seemed that at least we had an honest position to start from.
	However, we seem to have ended up with an entirely dishonest clause. It pretends that there is a tenable position half way between outlawing paying for sex and allowing it. That is not so. We should start from the position from which the noble Baroness who moved this amendment comes—the protection of the women involved in this business—and from the position adopted by the noble and learned Baroness, Lady Butler-Sloss, on dealing with trafficking. Those are the evils that we should be intent on dealing with and we should ask ourselves at every step whether those are the effects that the clause or the amendments to it will have.
	Some have argued that the Norwegian experience of banning paying for sex has been effective. Yes, but that is not where the Government are. The Government are in this strange half light of criminalising men for something that they cannot know that they are doing. That is an exceptionally undesirable position for the Government. I know that we will visit this issue later, but not while I am here. The Government should think again and say, "We have gone down the wrong road and Clause 13 is not the right way to do it". The amendment is an improvement on Clause 13, but I urge my noble friend and the noble Baroness, Lady Miller, when they divide the House—if not now, then on Report—rather to go for eliminating Clause 13 altogether.
	It surprises me that a Labour Government should go down this route. In the end, it will be a law that, among other things, will bite the poor, not the rich. It attacks the forms of prostitution used by ordinary working men, not those used by rich men. That is unjustifiable social discrimination. Again, if the Government were being honest and had gone for the position expressed by my noble friend Lord Waddington and their own original desire to ban paying for sex, that would bite all equally. The Government's social conscience should not allow them to go down this route.
	We have not heard any declarations of interest by noble Lords who have spoken—at least not in the sense that I mean. I note that there are a couple of dozen of us here and it is said that one in eight men uses prostitutes. There is, therefore, a less than 5 per cent chance, on average, that none of us has an interest to declare—but then we are not an average lot.

Lord Brett: I thank all the contributors to this debate. It was inevitable that it would not only spread across Clause 13 and Amendments 45 and 56 but spill over into some of the issues that have strong support inside and outside this Chamber, whether it is to decriminalise prostitution completely or to ban paying for sex completely. Indeed, we could inevitably start to stray into the next major contentious issue, which is strict liability. However, I shall follow the good advice of the noble Baroness, Lady Hanham, and not stray into that area until we reach it.
	We are grateful for the constructive attempt to improve this clause, which has already gone through another place. We have considered the issues raised by Amendments 45 and 56 but none the less still believe that Clause 13 and the amendments that we have tabled to improve it represent the best way of defining the elements of this offence and finding a clear distinction between conduct that we wish to cover and the conduct that we do not.
	Before I deal with the amendment in detail, I should like to explain the rationale for the offence created by Clause 13 and set out in general terms what it is intended to cover. I assure noble Lords that the offence is very much intended to be part of the Government's response to the problem of trafficking. I sense from some of the contributions that there may be a fear that we are talking about creating a new offence as a substitute for our efforts, through law enforcement, to get trafficking under control, to get the traffickers into court and to prosecute them. However, nothing could be further from the truth. This is simply another weapon in the armoury and not an attempt to reduce our endeavours to ensure that the horrible trafficking of women for sex is brought to a halt as soon as possible. This is very much part of a general response to the problem of trafficking. Taking steps to tackle the demand for trafficking for sexual exploitation was one of the actions recommended in the UK Action Plan on Tackling Human Trafficking. It was also a requirement imposed by Article 6 of the Council of Europe Convention on Action against Trafficking in Human Beings, which the UK has now ratified.
	I emphasise that this offence is one part of a comprehensive approach to trafficking. The need to respond to this serious issue was clearly one of the motivating factors behind the Government's review on tackling demand, which also recommended that other measures, such as tightening up the law on kerb-crawling, be looked at. However, the concerns behind these amendments go beyond the protection of those who have been trafficked; they also include a wish to tackle other forms of exploitative prostitution, which I assure those who have tabled the amendment is also the Government's aim.
	We see a need to reduce all forms of commercial sexual exploitation. That is one of the key objectives of the Government's co-ordinated prostitution strategy, which sets out a comprehensive approach to tackling this issue. Many of the action points in the strategy have already been put in place. However, a number of the responses to the consultation, which informed the development of the strategy, emphasised the need to consider doing much more to tackle the demand for prostitution. That relates to the Government's attempt to create a culture shift in how we view prostitution and how we deal with it at law.
	As part of the Government's review on tackling demand, we considered the approaches taken to prostitution in different countries. The noble Baroness, Lady Miller, asked whether we had looked at the situation in New Zealand. Prostitution was decriminalised in New Zealand in 2003 under the Prostitution Reform Act. It is now a regulated endeavour and, under the provisions of the Act, brothels and escort agencies are required to be licensed and to have operator licences. We considered such an approach, but responses to the consultation and the evidence that we considered, which are highlighted in the review on tackling demand, supported taking a different approach—increasing criminal justice enforcement measures to tackle demand in order to target exploitation within the prostitution market. Our view is that it is not yet clear whether the New Zealand approach has proved to be effective and whether, in the long term, it would be beneficial. The noble Baroness referred to a five-year review, but I do not think that we have had sight of it at this stage.
	To tackle demand, it would be necessary to criminalise those who contribute to the demand for trafficking and other forms of sexual exploitation by paying for sex with those who are subject to exploitation and to deter those who pay for sex in such circumstances. We considered the option of criminalising those who pay for sex whatever the circumstances of the prostitute, but concluded that that was not the right approach. Instead, the review recommended that measures should be targeted at reducing areas of the sex market involving the most vulnerable—those who have been trafficked, exploited or involved in street prostitution.
	The offence is targeted at those who are forced or coerced into providing sexual services, which may be as a result of being trafficked but may also be a result of other forms of exploitative conduct. We recognise that defining such conduct is not easy; amendments have been tabled both in another place and for discussion in this Committee to ensure that the definition is as clear as possible. As a result of the constructive approach that has been taken thus far, we have been able to create an offence that is clear and which achieves its aim of criminalising those who pay for sex with someone who is subject to exploitation.
	I shall now set out why we believe that these amendments are not helpful in achieving that aim and shall try to respond to some of the points made by noble Lords. We note that the amendments would make it an offence to pay for sex with "the victim of trafficking". While we understand the sentiments behind that, the wording is problematic. It would mean that, where someone who had been trafficked escaped from the traffickers yet chose to work as a prostitute, it would still be an offence to have sex with that person if one knew, or ought to have known, of the person's past. Given the definition of trafficking, the person would not need to have been trafficked into the United Kingdom for sexual exploitation. They could have been trafficked for labour purposes, as we have seen in some parts of the agriculture sector.
	The clause focuses on the conduct that is likely to be induced or which encourages the person to provide a sexual service to the payer. It covers cases in which a prostitute is coerced by traffickers but correctly excludes those cases when a person who was once trafficked to the UK now chooses to provide sexual services of her own volition. They will not be covered. The amendments would also cover those paying for sex with someone who has been subject to coercion. We have tabled amendments that make it clear that any form of coercion will be covered by Clause 13 offences. That includes threats of a non-violent nature, such as threats to withdraw accommodation or emotional support if the person does not provide sexual services. Government Amendments 52 and 62, which we will consider later, will cover that.
	Amendments 45 and 46 would also make it an offence to pay for sex with a person who provides sexual services to gain access to controlled drugs. Clause 13, as currently drafted, deals with the issue of a prostitute agreeing to provide sexual services because her pimp has threatened that he will otherwise refuse to supply her with controlled drugs. However, it will not cover someone who decides to work as a prostitute and chooses to use the money to pay for controlled drugs. By contrast, Amendment 45 would cover both those scenarios and, as such, is too wide. While we accept that there are clearly circumstances in which people provide sexual services under desperate conditions, including to gain money for drugs, catching those who pay for sex with someone who has freely chosen to engage in prostitution and then spends the money that they receive on drugs would be beyond the aim of the offence, particularly as it makes no distinction between those who are feeding an addiction and those who may be occasional recreational drug users.
	The amendment would also make it an offence to pay for sex with someone who had been directed or instructed to provide sexual services in circumstances when they had not consented to such direction. We would expect Clause 13 as drafted to cover most of the scenarios. If someone does not consent to a direction, one assumes that they would be free to ignore it, unless the direction was backed up by some force or threat. We believe that such conduct is already covered and falls within the scope of Clauses 13 and 14.
	We also note that the offence created by the amendments would cover someone who has used the services of a prostitute who had been trafficked or coerced or was otherwise considered to be exploited under this definition, rather than just someone who has paid for sexual services. There is a danger that the offence would criminalise consenting relationships, such as those between prostitutes and their partner or spouse, as there is no requirement for payment to be made when the person uses the sexual services of the prostitute in that circumstance. It is the payment to those controlling the prostitutes that fuels the demand, so that is the act on which we wish to focus our endeavours.
	The amendments also address the issue of strict liability by making it a requirement of the offence that the sex-buyer knew, or ought to have known, that the person whom they paid to have sex with had been trafficked, coerced, or the like. Although we understand and take seriously the concerns of the supporters of the amendment—indeed, such concerns have been raised in another place—we believe that it is important to maintain the strict liability element of the offence, for reasons that I will explain more fully when we consider Amendments 46, 50, 57 and 60. I also intend to deal with the concerns raised by the noble Earl, Lord Onslow, in respect of the Joint Committee on Human Rights about the strict liability element of the offence when we come to debate those amendments.
	Several important points were made by noble Lords, which I will seek to address. They cluster, in some ways. The noble Baroness, Lady Hanham, gave an excellent analysis of the problem that we have in dealing with trafficking and how we have to make more endeavours not only to control the importation of prostitutes who are trafficked but to deal with the demand side. The noble and learned Baroness, Lady Butler-Sloss, rightly said that there is an improvement in the prosecution rates. It is relatively recent, but prosecutions have been increasing as policies have been developed by the police to respond to the threat, such as intelligence-led, co-ordinated operations across police forces, which can be successful in identifying trafficking activities and rescuing victims. On the question raised by the noble and learned Baroness about providing some form of immunity for those who give evidence to convict traffickers and brothel owners, we do not believe that blanket immunity would be suitable. However, the CPS has discretion to decide where it is in the public interest to prosecute when a Clause 13 offence is thought to have taken place. The decision is taken in each individual case.
	My noble friend Lord Judd raised the issue of support for criminal legislation. A number of voluntary organisations working with prostitutes support criminal legislation to tackle demand and support Clause 13—CARE, Toynbee Hall, the POPPY project and others. Of course, there are those who would want decriminalisation to be the first option, but in the absence of decriminalisation they want the Government to do far more to ensure that the demand side is tackled.
	I hope that I have dealt with most of the questions. The noble Lord, Lord Pearson of Rannoch, asked how, if the individual did not know, the police would be able make a case for prosecution. The police would in such circumstances try not simply to arrest the person who was paying for the trafficked prostitute but to collect sufficient evidence so that the trafficker, the brothel owner and the sex-buyer were all in the frame, as you might say. We want to tackle the demand for such prostitutes. They, the trafficked people, are not the problem; it is the market that we seek to control.

Lord Pearson of Rannoch: Before the noble Lord moves on, with respect, he has not quite answered the point that I put to him, which was to try to get inside the mind of an arresting officer—what the officer knows when he arrests the client. It seems to me that, if the person has been trafficked, in order to make the arrest and bring a successful prosecution, the arresting officer has to be able to prove who were the controllers in this country, or whoever was controlling that unfortunate woman—likewise with the victim of a pimp and the instances that the Minister gives of the supply of drugs. There is really no point in the police arresting the client unless they have knowledge that will enable them to arrest the cause of the problem, which is not the girl—or, indeed, the client—but the person who is controlling the unfortunate lady. That was my point.

Lord Brett: I understand the point the noble Lord makes. The difference is simply that he is seeing this as a one-dimensional picture. Many of these traffickers and the brothels in which prostitutes work—they are moved between different locations—will be matters of covert police investigation. The police will build up evidence over time. It may well not be a case of arresting all those in the building at the time. The covert operation may identify people who use the trafficked prostitutes and, when that evidence has been built up, arrests can be made. The collection of evidence is not the easiest of tasks. To return to a point made by the noble and learned Baroness, it is extremely difficult to capture and bring to court traffickers on an international basis. That is why international co-operation—

The Earl of Onslow: Will the Minister give way?

Lord Brett: I shall finish this because I am dealing with the international scene. If we have close work with other police forces through Interpol and on a bilateral basis, we can bring to task international rings that traffic prostitutes.

The Earl of Onslow: My noble friend Lord Pearson of Rannoch is making the good point that to get a conviction you will have to prove that the girl has been trafficked. To prove that she has been trafficked, you must surely have to know something about who has done the trafficking. That is the point my noble friend made, and I did not think that the Minister quite answered it.

Lord Brett: I am happy to give an example, which is always dangerous. If a brothel is under observation and it is suspected that prostitutes are being trafficked, primarily because they are being moved between different cities, which is quite a common occurrence, the place will be kept under observation for a number of days. People will be seen going in and coming out, prostitutes will be seen going in and coming out and the movements of the people running the brothel will be seen. At some point, sufficient evidence will have been gathered to make arrests. They will be made in the light of those observations. We are going on to the question of strict liability; the person who has been to that brothel will be interviewed by the police and, under strict liability, cannot defend himself by saying that he did not know, provided, of course, that we ensure that when this becomes law, there is sufficient publicity to ensure that men understand that there is that risk that if they use prostitutes, there will be circumstances in which they may find themselves fined up to £1,000. I hope that makes it a little clearer.

Lord Pearson of Rannoch: Not really. Surely when the police make this famous arrest, the activity in the brothel is likely to change immediately. People will all bolt like scalded cats in all directions. The Minister has not answered the question about what is in the knowledge of the police to make a successful arrest under this clause.

Lord Brett: I apologise for failing to convince anybody with my previous example. I shall try it again. You have customers for the prostitutes; you have eastern European—we will say eastern European, but they could be from any part of the world—prostitutes who are moving between cities. The police gather evidence and raid the establishment after observing who has come and who has gone. They will make criminal charges against the traffickers and the brothel owners, but the customers will have committed an offence if it turns out that the prostitutes were trafficked because under strict liability legislation customers will be liable whether they knew that the person was trafficked or not.

Baroness Stern: I will pursue two points. The first is that of the noble Lord, Lord Lucas: that the outcome of this legislation is that the part of the sex industry that is used and worked in by poor people will be criminalised while the rest is unaffected. Secondly, can the Minister confirm whether, while there are a few organisations working with sex workers who support the Government's approach, there is a coalition of all the projects that actually work with street prostitutes? I think there are 63 of them but I am sure that the Minister will correct me. None of them support the Government's approach and feel that it will make the work of those they try to help much more dangerous.

Lord Brett: On the latter, the consultation has elicited quite a number of views; as I said at the beginning of my contribution, there have been extremes, from decriminalising to a total ban. The Government have arrived at their policy judgment following those consultations. I can add no more to that. I am afraid that I missed the first point; if the noble Baroness could repeat it, I would be delighted to try to respond.

Baroness Stern: I was asking whether the Minister has a response to the point of the noble Lord, Lord Lucas: that the Government's approach will criminalise the poor users of sex workers and those who work in the most exploited end of the sex industry while leaving the upper end untouched. I think the question of the noble Lord, Lord Lucas, was whether that was the Government's intention.

Lord Brett: My direct answer to the noble Lord, Lord Lucas, would be that rich men exploiting trafficked prostitutes are just as bad as poor men doing so. On the second point, our endeavours in this piece of legislation are of course to protect the most vulnerable. As we go through all clauses, not just this one, I hope that we can demonstrate not only the Government's intent but that this is a constructive way of achieving it. I recognise that there are very strong opinions on the issue, and that those arguments will echo around as we go forward. We will seek to find our way through them.
	I look at the noble Lord, Lord Lucas, simply because he is one of those to criticise more recently and, perhaps, directly; many have voiced not doubts about our intent or beliefs that our intent is not in good faith, but questions on whether we will have the benefit of unintended consequence, as my noble friend Lord Desai put it. I am frankly not sure that I buy the economic argument being translated into this field, which is not simply a transaction. In fact, I am reminded that labour in any form is not a commodity.
	I am pleased and grateful for the support of the right reverend Prelate, who makes a good point. This is not a moral issue, but one of how we protect very vulnerable people. We have responded to the specific concerns raised in the other place, echoed here by the amendments we have tabled. The version of Clause 13 that we want to introduce will best address the aim of protecting vulnerable people involved in prostitution. It will address many of the circumstances that Amendments 45 and 56 would cover. I hope that your Lordships will appreciate why the Government have taken this view, and respectfully ask the noble Baroness to withdraw her amendment.

Baroness Miller of Chilthorne Domer: That has been an incredibly helpful debate in drawing out the confusion that lies behind the Government's approach at the moment—whether they are actually talking about stopping trafficking. We had some fantastic contributions on the issue, starting with the tour de force of the noble Baroness, Lady Hanham, about why we must address trafficking. On that issue, the noble and learned Baroness, Lady Butler-Sloss, mentioned the presentation by the Director of Public Prosecutions which I went to as well last Monday. When he did not directly address this Bill, he talked about all the legislation that could be used against traffickers and mentioned the increasing expertise of the CPS. The evidence that the DPP presented to us on Monday, which the Government could follow, is that the existing legislation should be used better, not that we need more legislation.
	Is this clause about reducing demand? I do not think that the Minister has proved the case for that at all. He referred to the police observing the comings and goings at brothels but he did not explain how the clause would reduce demand. Having to ascertain where a prostitute comes from will not make men feel less like buying sex but will mean that they are more likely to buy it from someone with a British accent. Therefore, the clause will change demand rather than reduce it. I thoroughly agree with the noble Lord, Lord Lucas, that the provision is dishonest as rich men will still be able to keep their mistresses in flats and call that something other than buying prostitution, although that is what it is.
	I am not on a moral crusade although I say to the right reverend Prelate the Bishop of Chester that I do not think there is anything wrong with a moral crusade provided it is on the right issues. I absolutely agree with his comments about the abhorrent practice of the increasing sexualisation of children, and that such issues are not addressed in the Bill.
	I am especially grateful to the noble Baroness, Lady Stern, and to the noble Earl, Lord Onslow, who added their names to my amendment and spoke so powerfully on it. The noble Earl, Lord Onslow, said that we should aim to have legislation which makes it easier for the client to report these issues. Other noble Lords also made that point powerfully. That is exactly what we should be aiming for, but I heard nothing in the Minister's reply which suggests that is the road he is going down. The noble Baroness, Lady Stern, is absolutely right about the coalition that certainly does not support the Government's stance and is deeply worried about it. The Minister slightly dismissed the New Zealand evaluation. However, as pointed out by my noble friend Lady Tonge, who speaks on health matters but is unable to be here today, in addition to the trafficking, health issues should worry the Government and they should concentrate on those. The New Zealand evaluation forcefully addresses health issues.
	Possibly for the first time I agree with the noble Lord, Lord Pearson of Rannoch, although I am very pleased that that is the case. He made some extremely good points which are very well taken. I am glad that he pursued them. The Minister says that this clause is simply another weapon in the armoury. The Government are creating a cannon—to continue the metaphor—when they need a sniper's rifle, which they already have, as the DPP said. I worry that the cannon, when fired, will catch all sorts of innocent and vulnerable people, including the children of prostitutes. It is absolutely the wrong mechanism. We will work strenuously with the Government to consider how the Bill can address trafficking more forcefully and we shall return to Clause 13 on Report. The comments made by noble Lords all round the Chamber lead me to the conclusion that the Bill would be better off without this clause. However, in the mean time, I beg leave to withdraw the amendment.
	Amendment 45 withdrawn.
	Amendment 46
	 Moved by Baroness Hanham
	46: Clause 13, page 15, leave out lines 36 to 38 and insert "and knows, or ought to know, that a third person (C) has used force, deception or threats of a kind likely to induce or encourage B to provide the sexual services for which A has made or promised payment, and"

Baroness Hanham: I remind the Committee that I am a serving magistrate, as I declared on a previous occasion. Inevitably, the debate has strayed a little between these two amendments. I am amazed that we have managed to hang on to this amendment, which stands very much on its own and is a very important part of what we are discussing.
	I am very grateful for the support of the noble Baroness, Lady Miller, for this amendment. I think that she will join me in saying that one of the greatest concerns of many noble Lords is the imposition of the strict liability on the defendant and that there is no defence against the charge that he was going to have or had had sex with a prostitute who had been trafficked.
	I am not a lawyer, but it seems to me that it is an extremely serious matter to put someone in jeopardy of the law by an incontestable assumption of guilt. In the case of a person who seeks sex from a prostitute who—the noble Lord, Lord Pearson, has already raised this—at a later date is found to have been trafficked, exploited or abused, in hiring her for sex he commits an offence whether or not he knows or has any reason to believe that she has been trafficked. This assumption of knowledge as a basis for prosecution clashes, we believe, with natural justice. At least an offence should be committed only if it can be proved that the defendant could reasonably have known that the prostitute had been trafficked.
	I know that many will disagree with giving even this limited amount of defence and we have heard a little of that today. There are those who believe that these provisions will, because of the jeopardy in which the punter is being placed, reduce the amount of prostitution per se. Again, we have discussed the purpose of Clause 13. Many see this as a moral issue, but because this clause and the offence are so prescriptive it is in our view solely an issue of justice.
	Like other noble Lords, I have been inundated with e-mails, letters and briefings. This issue has led to an enormous amount of lobbying from both sides on all aspects of Clause 13. Quite rightly, concern over exploited prostitutes' welfare has led to the involvement of many organisations, all of which are seeking the same result: largely the ending of all prostitution—again, we have discussed that briefly—whether there is evidence of trafficking or not. There are those who believe that this proposed legislation is unworkable in that the offence will be almost impossible to prove. So it will not achieve its aims of reducing the number of prostitutes who are controlled by pimps or who help to make prostitutes any safer.
	We need to remind ourselves again that prostitution per se is not a crime, although a good many offences are attached to it. Contrasting views and opposing testimony show just how important it is that the legislation is clear, unambiguous and, above all, does what is intended. The primary reason for this offence being promoted is to seek to protect those who are exploited and trafficked for sex, and to reduce the opportunities for those generating and profiting from that exploitation.
	These are laudable aims, but we must remember that unworkable law will not help anyone. It will not support the victims seeking protection from exploitation or help the police looking to prosecute the criminals involved. An offence that proves to be impossible to prosecute will only waste the enforcement agency's time and resources, and add yet another layer of confusion to an industry already operating in the shadows. In the Minister's reply to the previous amendment, we got some indication of how the Government see this working, but as I understand it it also requires the police and other agencies to have or to obtain knowledge that someone had been trafficked. They may or may not get that information from the punter if the punter is under threat of prosecution.
	The question of whether the offence should be one of strict liability has been considered by a great many bodies. The Joint Committee on Human Rights is surely not a committee that one would ever suggest did not take the protection of the vulnerable seriously enough. It clearly stated that the Government have failed to demonstrate the necessity for the new strict liability offence. It stated:
	"In our view, the proposed offence has the potential to put women into more exploitative or unsafe situations, may not address the problem which the offence aims to target (namely exploitative prostitution) and may discourage reporting of such prostitution."
	Justice, another organisation dedicated to the protection of human rights and the improvement of the legal system, also opposes a strict liability offence, as do Liberty and the Bar Council. All these organisations believe that the human rights issues in such an offence, couched as it is and being one of strict liability, make it extremely unlikely that a conviction will ever be achieved.
	All that this offence will result in is an even lower incidence of reporting as punters shy away from talking to the police for fear that they will be prosecuted for an offence against which they would have no defence. I hope that the Government, who in the next group of amendments indicate that they are listening to the concerns being raised about aspects of this clause, will also listen to our concerns. In moving the amendment we are looking at the adequacy or otherwise of the fairness of a prosecution. In doing so, I do not dismiss nor am I unsympathetic to the grave concerns being expressed, but this House as well as the other place need to be clear that when they put legislation for offences on to the statute book, it is fair and just. I beg to move.

Lord Colwyn: I must advise the Committee that if this amendment is agreed, I shall be unable to call Amendment 47 because of pre-emption.

Lord Lloyd of Berwick: I support this amendment for all the reasons that have been given by the noble Baroness and, very simply and very briefly, on the basis of the facts of a case that is well known to any lawyers that are here present; I think that two other lawyers are here present. I refer to a case known as Sweet v Parsley (1970) AC 132. The facts were that the defendant let out rooms in a farmhouse. Some of her tenants smoked cannabis. It was accepted by the prosecution that she did not know that fact. She was convicted of managing premises used for the purpose of smoking cannabis on the ground that the offence was an absolute one and that it was therefore unnecessary to prove knowledge. She did, in fact, manage the premises. The premises were, in fact, used for smoking cannabis and therefore that was thought to be sufficient for her conviction. When her case reached the House of Lords, her appeal was allowed. I want to quote only two sentences from the speech of Lord Reid—the great Lord Reid, as I think one can call him. On page 148 he said:
	"How has it come about that the Divisional Court has felt bound to reach such an obviously unjust result?".
	Later on at page 151 he said:
	"Speaking from a rather long experience of membership of both Houses, I assert with confidence that no Parliament within my recollection would have agreed to make an offence of this kind an absolute offence if the matter had been fully explained".
	To adapt those words of Lord Reid to the present case, it seems to me that to convict a defendant of an offence under Clause 13 when he does not know and has no means of knowing that she was a controlled prostitute would be, in the words of Lord Reid, obviously unjust. As to the second quotation, Parliament may have changed since the days of Lord Reid, but I cannot believe that we have deteriorated so far as to make an offence of the kind set out in Clause 13 into an absolute offence without proof of knowledge.
	The clause is all the more wrong-headed because I cannot see how, as it stands, it would achieve its object. Prostitution is not a crime. I do not see how this clause will serve to protect prostitutes—an important consideration; how it will reduce the demand for prostitution—as is said to be the case; and still less how it will reduce the number of pimps.
	I confess that when I first saw Clause 13 I was astonished. That was many, many months ago and, for what it may be worth, I expressed that astonishment in a public lecture. I do so again today. I will be happy to see the clause if it is amended as is now proposed, but not otherwise.

Lord Pannick: I, too, support the amendments. I also am concerned about the strict liability element of the proposed offence.
	Your Lordships will, I am sure, accept that strict liability crimes are sometimes justified in the context of sexual offences. An example, which I hope is illuminating for our purposes, is Section 5 of the Sexual Offences Act 2003, which makes it an offence for a person to have sex with a child who is under the age of 13 irrespective of whether the defendant knew or ought to have known of the age of the victim. The differences between Section 5 and Clause 13 illustrate the problems with the proposed offence.
	Your Lordships may know that in June 2008, in the case of R v G, the Appellate Committee of your Lordships' House considered and dismissed the argument by a man convicted of an offence under Section 5—having sex with a child under the age of 13—that the strict liability element in the Section 5 offence was a breach of his human rights. But the Appellate Committee emphasised that there were strong policy reasons for making that offence one of strict liability. The object there was both to protect children from predatory adults and to protect the child from premature sexual activity of all kinds.
	It is much more difficult to identify any policy which can justify strict liability in the present context. As noble Lords have already pointed out, it is not the policy of the Bill that all prostitution should be made a criminal offence by the customer; nor is the Government likely to accept the arguments powerfully advanced by the noble Lord, Lord Waddington, that paying a prostitute for sexual services should be made a criminal offence.
	In Clause 13, one faces the difficulty that the relevant ingredients of the offence are not clear by contrast with the Section 5 strict liability offence. In the context of Section 5 on having sex with a child under the age of 13, the child either is or is not under the age of 13. The age is discoverable by a number of means. By contrast, Clause 13 would mean that whether the criminal offence was committed by the customer would depend on specific factual matters—that is, whether a third person has used force, deception or threats or engaged in exploitative conduct—as outlined in the Government's proposed amendment. But such matters are not objective; they are not incontrovertible facts but highly contentious matters. Indeed, they will inevitably be the subject of dispute between the prostitute and the third party.
	In the light of this, my question to the Minister is: can he give the Committee any other example of a strict-liability offence where that liability arises in a context that is not one where there is an absolute prohibition on defined conduct by reference to an objective criterion such as a person's age, such as in Section 5 of the Sexual Offences Act, but rather an example of a case where strict liability applies only where criminal liability occurs that is dependent on so vague and contentious a criterion that is referable to the alleged conduct of a third party?

Lord Borrie: I find myself in agreement with most of the criticisms made by the noble and learned Lord, Lord Lloyd of Berwick, and the noble Lord, Lord Pannick, of Clause 13 as it stands. I am not sure that I go with them in supporting this amendment, but I am with them in their basic criticism of the clause.
	I sat through the previous debate, though I did not take part. As noble Lords who were here will know, it lasted for about an hour and was fully comprehensive on all sorts of matters, including what we are discussing now. However, I did not hear the Minister explain with any clarity what the justification was for making a person who obtains sexual services from a controlled prostitute liable for a criminal offence irrespective of his knowledge, likely knowledge or "should-be knowledge" of whether the prostitute giving her services had been forced to do so.
	I am still extremely unclear on that point, except—although he is not in his place, I am referring here to the noble Lord, Lord Waddington—on the basis that the Government's real objective is to bring about an end to, or a ban on, the provision of sexual services for money. If that is the Government's intention, Clause 13 is a most powerful deterrent to a man obtaining sexual services from a prostitute; irrespective of whether or not he knew that she was controlled, he would be liable under the Bill. I am therefore against Clause 13.
	As with the noble and learned Lord, Lord Lloyd, and the noble Lord, Lord Pannick, the reason why I am uncertain about being in favour of the amendment is that, with all the good will in the world towards an amendment of this kind, and for the legal policy reasons that have been explained by those who have spoken before me, I do not think it would achieve its objective. Looking at it from the prosecution's point of view, how on earth in practice is the prosecution going to prove, except in the most remote cases, knowledge or "ought-to-have knowledge" of the controlled nature of the prostitute's services? In amending the Government's Bill we would be putting forward a criminal offence that would be almost impossible to prove.
	If the amendment were part of the law, those who control the prostitute would make it their business to ensure that the women concerned made no reference to, and gave no indication of, where they had come from in Eastern Europe or wherever, how they had got there or anything else. Therefore, although I support what has been said in criticism of Clause 13, I do not feel that I can support the amendment. I would rather simply eliminate Clause 13 and, as the noble and learned Baroness, Lady Butler-Sloss, explained in the previous debate, use more effectively the existing laws we have against traffickers. We should go for the traffickers, not the man or the woman seeking or providing sexual services.

Lord Baker of Dorking: Having listened to the speeches of the noble and learned Lord, Lord Lloyd of Berwick, and of the noble Lords, Lord Pannick and Lord Borrie, it appears to me that the Minister is being asked questions which he cannot possibly answer, verified by the fact that the noble Lord, Lord West, went a moment ago to the Box to check whether there was an answer available. This is a matter for the lawyers. There is clearly real anxiety about the effectiveness of this clause. I suggest that it might be an idea for the Minister to take away the clause and think again about it before Report, at which time he might invite the Attorney-General to give the advice to the House, as it is a matter for the lawyers to decide.

The Earl of Onslow: The quote from Lord Reid that the noble and learned Lord, Lord Lloyd, used is a stunningly great principle of English law and the liberty of the subject which we have known since the dawn of legal memory in, I believe, 1189. That is a principle and a core which has gone through all our history; it makes us what we are and it makes the point of the law in this country such a magic thing. I speak as a non-lawyer, but as someone who has read a little bit of history.
	We on the Joint Committee on Human Rights said:
	"The proposed new offence raises issues about whether the interference with the right to respect for private life (Article 8 ECHR), which includes sexual conduct, is sufficiently certain to satisfy the Convention requirement that such interferences be 'prescribed by law'".
	In all honesty, this is not quite as strong as I would have liked. Having listened to the noble and learned Lord, Lord Lloyd, the Government should, with respect, put their tail between their legs, be as quick as they can, come back with a big, happy smile on their face and say that the noble and learned Lord was right.

Baroness Miller of Chilthorne Domer: I have put my name to this amendment. We have heard the legal arguments and I want to advance a little more evidence. A very interesting study, at which I have had an advance look, will be published on 10 July. It has been commissioned by the Economic and Social Research Council at the University of East London and is entitled Migrants in the UK Sex Industry by Dr Nick Mai. There are many conclusions but the ones relevant to this discussion show why it would be so difficult for a client to know. Not all prostitutes are women who have been trafficked; we often think of them as helpless victims who have been kidnapped. Dr Mai found that many of the people interviewed were from relatively privileged backgrounds who had aspirations to improve their living conditions. They had employed traffickers to help them come to this country. They paid money to be trafficked. Are they victims? They were self-determining; they chose that for themselves, partly because for those with undocumented status, the sex industry provides a way of working away from the public eye as it is largely informal. There were many more findings of that nature. So knowing whether someone is actually a victim and is being coerced is not that simple.
	The second finding that has some bearing on this debate is that less than 10 per cent of the people interviewed had experience of exploitation. In all those cases, the clients played a key role in their strategy for escape. Women count on their clients, and if the clients are criminalised, they will not be able to help.

The Lord Bishop of Chester: In one of St Paul's letters, he prefaces his argument by saying:
	"I speak as a fool".
	I can only reiterate the apostle's words when entering a debate on a legal question with the noble and learned Lord, Lord Lloyd, and the noble Lord, Lord Pannick.
	The noble Lord, Lord Borrie, demolished the amendment very effectively and said that the real issue was whether Clause 13 should stand part of the Bill. That is the real force of the arguments of the noble and learned Lord, Lord Lloyd, and the noble Lord, Lord Pannick, although I note that they expressed support for the amendment. There are powerful arguments on their side. I should like at least to put the other point of view, although I am sure that the Minister will do it far better, with the advice that is available to him.
	In a sense, this is quite a strict liability—it is a semi-strict liability. First, the man has chosen to pay for sex. The starting point is not somebody innocently caught up, which is where the case of the person who found that a lodger was smoking cannabis behind a locked door is not an exact analogy. We are starting with someone who is paying for sex. It may be that behind this, as the noble Lord, Lord Borrie, suggested, there is a desire to criminalise paying for sex. That point was raised by the noble Lord, Lord Lucas, who is not in his place at the moment.
	To use the Minister's phrase when he responded to the previous debate, the issue turns on whether we need a whole culture shift in the area of prostitution. I think that the Government take the view that we do. There is a growth in prostitution and those who are engaged in it are now increasingly exploited in the most dreadful way. The noble and learned Baroness, Lady Butler-Sloss, gave a vivid illustration of that earlier. In fact, the girl to whom the noble and learned Baroness referred had in all but name been raped. Think how we in this country regard rape. A lot of the prostitution that occurs in this country is in all but name rape. In those circumstances, I think that the Government are right to say that something has to be done—something which targets the worst examples and aims to achieve a culture shift.
	Notwithstanding the powerful arguments of the noble and learned Lord, Lord Lloyd, and the extremely learned noble Lord, Lord Pannick—I respect them hugely as lawyers and normally agree with everything they say—on this matter I think that the balance comes down in favour of the Government.

Lord Desai: When you say that a person is paying for sex, you are already presuming his guilt. That is the problem. It is not an offence in this country thus far to pay for sex with a consenting partner. Therefore, if you say, "Ah, but this man has paid for sex, therefore the rest follows", you have to be very careful. Some of us may not like prostitution and would like to reduce it, but moral considerations are moral considerations and legal considerations are legal considerations, and we are here passing a law.

The Lord Bishop of Chester: In any interchange with the noble Lord, Lord Desai, too, I preface my remarks with the words of the apostle:
	"I speak as a fool".
	However, I do not think that his argument is entirely convincing. I would not want to say that we presume the guilt of any man who pays for sex but any person paying for sex needs to take extreme care to make sure that they are not complicit in the exploitative activities to which we have referred. I do not think that it is a presumption of guilt; it is a presumption of extreme care on the part of somebody paying for sex.
	There are strong arguments on both sides. I admire the Government's courage for taking this matter on. It comes down to whether we need that culture shift. At the end of the day, that is what determines whether we allow a strict liability provision—it is whether the issue is such that unless we do, we will not address it. Whether Clause 13 stands part of the Bill or not, without the strict liability provision, it will be a dead duck.

Baroness Butler-Sloss: I had not intended to speak on this part of the Bill, because I so profoundly agreed with the noble and learned Lord, Lord Lloyd of Berwick, and the noble Lord, Lord Pannick, that I did not think that I could add anything useful, but I am impelled to my feet by what the right reverend Prelate said. If he is right that a culture change lies behind the Government's intentions, what the noble Lords, Lord Lucas and Lord Waddington, said has the greater importance. The Government ought to come to clean; they ought to get rid of Clause 13, as the noble Lord, Lord Baker, said earlier, and look again. If they think that they ought to get a culture change by tackling the worst of it, it will not work; they have to ask, "Is it wrong for men to pay for sex?". There are a lot of people who say that it is wrong and a lot of people who say that it is not, but the Government have to say one way or the other.
	However, to take part of the problem and use a strict liability clause to do it is anathema to most people and not just to lawyers. One has to be very careful in either House of Parliament to approve of strict liability, despite what the right reverend Prelate said—I respect his view but, in my view, he is wrong. A strict liability clause is such a serious matter that one has to be very careful. To use it as part of a culture change seems not to meet the problem. The Government have to nail their colours to the mast and say whether it is wrong for men to pay for sex or only for some men to pay for sex with women who are trafficked. Those men are not all that evil; it is the traffickers who provide the women and, particularly, the children. The Government criminalise the children under 18 at the moment, and will continue to do so unless the relevant amendments are put through—I may not be able to be here for those. I hope that the Government will listen on children under 18. They say that they are victims, but they can also be criminalised and prosecuted. To go for the men in part of it is not to meet the problem. If it is a question of a culture change, the Government should nail their colours to the mast and get on with it.

Lord Brett: I thank noble Lords who have contributed to this debate. Perhaps I may begin by responding to the points of the noble and learned Baroness, Lady Butler-Sloss, and of the right reverend Prelate the Bishop of Chester. The right reverend Prelate said that it is a culture shift. We are not saying that consensual sex between a man who pays for it and a woman who is happy to receive money and is not trafficked or coerced in any way is illegal. This is not a campaign to outlaw prostitution; it is a campaign to persuade men to desist from exploiting women who are victims of trafficking or coercion. The provision will therefore be an amber flag or a red flag, signalling to people to think long and hard about it.
	I shall speak to all the amendments in this group, Amendments 46, 50, 57 and 60. Much has been said about the difficulty of getting a prosecution, even using Clause 13, complete with its strict liability. However, the strict liability aspect, which makes it illegal to pay for sex with someone who is subjected to force, deception or threat, is likely to have the effect of reducing demand. If men know in advance that if they are found to have been with someone who is in that situation, they are liable for a fine in court and a criminal record.
	The amendments would make it a requirement of the offence that the sex buyer knew, or ought to know, that the person whom they had paid for sex had been subjected to force. The amendments would allow the defendants to argue, which they are certain to do, that they did not know the circumstances of the prostitute. However, the amendments would add a mental element that would make the offence even more difficult to prosecute than it would be under strict liability.
	If a mental element was added to the offence, the defence would be available, and would be highly likely to be used, that the person did not know. It would also increase the need for victim testimony, which we wish to avoid given the trauma that trafficked women already experience. Furthermore, many people who have been forced, threatened or deceived in prostitution are vulnerable and inevitably subject to pressure. They may be pressurised to say that they had not been forced even though they had. The Government are attempting in this part of the legislation to make it clear that men should think long and hard about the form of prostitution they are getting involved in.
	At Second Reading, the noble Baroness, Lady Corston, drew the House's attention to a speech made in the other place by the right honourable John Gummer MP, who said that,
	"if someone wishes to pay for sex, they must recognise that in doing so they take on a particular burden. If they think that what they are doing is reasonable, they must recognise that the downside is with them and not with the woman concerned".—[Official Report, Commons, 19/5/09; col. 1438.]
	The risk of responsibility should rest with the payer to ensure that he does not pay for sex with someone who has been forced, threatened or coerced. It should not be a defence for the payer simply to say, "I did not know that the prostitute was forced, threatened or deceived". He knows that if he pays for sex he runs the risk that the person may be subject to exploitative conduct and that he is fuelling the demand for prostitutes and trafficking for such purposes. Indeed, he is lining the pockets of traffickers and pimps exploiting prostitutes for their own gain.
	We know that some people involved in prostitution are in the most desperate circumstances—we have heard about it in this debate—and are exploited tremendously by those seeking to gain from their involvement in prostitution. We want to ensure that sex buyers consider the circumstances of the prostitute and that such prostitutes are protected by the law so far as is possible. If a sex buyer proceeds with the transaction without being sure of the circumstances, they also should face the consequences.
	To support the legislation, we shall run a public education campaign aimed at making people aware of the reality of life for many prostitutes and the potential consequences of paying for sex with someone who could have been coerced into providing sexual services. This is one of the recommendations of the tackling demand review. Together with the offence introduced by Clause 13 and the other recommendations of the review, it will form part of the cultural shift that we hope to achieve by creating greater responsibility on the part of the sex buyer.
	We were obviously aware of the concerns about Clause 13 that were raised by the Joint Committee on Human Rights. I have no doubt that your Lordships would find it helpful if I set out our response to those concerns.

Baroness Hanham: Can I be absolutely clear about this? I have already made it clear that I am not a lawyer, so I speak for somebody who saw this clause and said at once, "This is way outside what seems to me to be the normal process of law in this country". Is the Minister saying that the particular action of a man having sex with a prostitute is so serious that, by all definitions, he has no defence whatever, even if he has no means of finding out whether somebody has been trafficked? That seems so far away from a court of law being able to listen to, balance and weigh the arguments and understand where there is a defence and where there is not. This is so far away from that that one has to ask whether this offence is so much more serious than any of the others—we have been quoted some—that one has to take away all possibility of a defence. We need an answer to that.

Lord Brett: The precise intent is that the person will have no defence, because this carries a strict liability. It is important, therefore, that they know in advance.

The Earl of Onslow: That was not the question asked. The question was whether the offence is so serious that it overrides all the points made by my noble friend and the noble and learned Lord, Lord Lloyd. The Government cannot see, understand or grasp the majesty of the defence and liberty of the subject and the rule of law when they introduce a clause such as this. It is a disgrace.

Lord Brett: I note the ability and agility of the noble Earl to get to his feet before I have completed the answer and dealt with the point. I was dealing specifically with the point relating to the human rights element, and the point that the noble Baroness raised. It is a question of the degree of seriousness. We can take the examples that we have heard in this debate today of women who are raped, terrified and mistreated. In a situation where a person has an opportunity not to pay that person and not to go to that brothel but also has a liability if they do so—and it turns out that the woman is in those circumstances—we are simply saying that the buyer has to take part of that responsibility. It is a matter of judgment of some contention, as we have heard in this debate, whether that is something that noble Lords wish to see placed in this part of the Bill.

Baroness Miller of Chilthorne Domer: The Minister is talking about a woman who has been raped, but that would be covered by the law of rape. We are—or I certainly am—still struggling with the fact that we have legislation in place, whether for trafficking, rape or violence against women, which allows a defence. Why is this so different? I agree that it is abhorrent if a client rapes a woman, and lots of prostitutes are subjected to violence. There are courses of action that can be taken within the law against them.

Lord Brett: I shall complete the answer and take the noble Baroness's point on board. First, we are satisfied that the Clause 13 defence complies both with the European Convention on Human Rights and the principles of common law. We do not accept that Article 8, which is about the protection of a person's private and family life, includes the right to pay for sex. Secondly, in any event, we consider that any interference with a person's private life would be in accordance with the law and could be justified as necessary and proportionate for the protection of health and morals and of the rights and freedoms of others.
	The issue with rape and prostitution is that rape is, of course, very difficult to prove, but here is a situation where a coerced prostitute is being exploited both by the person paying for the sex and, more particularly, by the trafficker or brothel owner. In that context, we seek the culture shift that says that someone using a prostitute in a brothel must take note that, if he does so, he will automatically be guilty if he finds afterwards that the person he has been with is coerced.
	If I can complete what I have to say, I may be able to save some interventions.

Baroness Hanham: However, I need to intervene. Does the Minister believe that the removal of any right of defence from somebody for an offence is analogous to an educational programme?

Lord Brett: It is not analogous to an educational programme at all. The educational programme is in the endeavour, in the event of this becoming law, that people who are in the situation of using prostitutes have knowledge in advance of what the situation is and what the law is. That is the educational element.
	The Human Rights Committee suggested that the offence is not sufficiently certain. We disagree; we believe that the clause is clear. If a person pays for sex with someone who is has been subject to force, threats or deception, they will commit an offence. If someone intends to pay for sex and has any doubt whether a prostitute is being controlled for gain, they can choose not to pay for sex with that person. It is important to make the distinction between legal and factual certainty; it is important that the offence is legally certain so that the person knows that, if all the factual elements of the offence occur, they will commit an offence. It may be difficult to know whether all the factual elements will occur in a particular case. However, this situation exists in other areas of criminal law. If an offender punches someone, intending to cause an injury, whether that person commits common assault, assault occasioning actual bodily harm or grievous bodily harm will depend on the nature of the injury that results, which that person may not have been able to judge in advance when throwing the punch.

Baroness Hanham: In any court of law—and as a magistrate I see this all the time—the defendant has a defence. It is not strict liability; there is always a defence.

Lord Brett: I hear what the noble Baroness says.
	The amendments that we made in another place help to clarify the scope of this offence and will, therefore, make clearer the circumstances in which it will be illegal to pay for sex with a particular person. That will help people to regulate their behaviour accordingly; consequently, for reasons that I have just set out, we believe that the strict liability aspects of this offence can be justified.
	I acknowledge the concerns of noble Lords. We have set out what we believe is the way to go forward. I noted the comments of the noble Lord, Lord Baker. While I found them patronising, I welcome the wisdom within them. I have to explain that the Attorney-General is not here today because she could not be here.
	The noble Lord, Lord Pannick, posed a question to which there is not an answer—namely, looking for alternative areas that would qualify, such as the child under 13. It would be sensible to take away all the points that have been made in what has been a very full debate. The only hopeful note that I heard was when the noble and learned Lord, Lord Lloyd of Berwick, said that there were only three lawyers in the Committee; I thought that that was less than normal. I take the point made in his contribution and that of the noble Lord, Lord Pannick. It would be sensible for us to take back without commitment all the contributions in this debate and look again at the whole area of proposals.

The Lord Bishop of Chester: I hope that the Minister, in offering to take this away for legal consultation—although I entirely accept the very serious legal points made earlier—will remember that there is also an important moral point here, which needs to be weighed with the legal point. If a man has sexual relations with a woman who has been coerced, forced, threatened or whatever, the moral status is akin to rape. That is the serious moral issue lying behind the difficult legal judgment that the Government face. I hope that both issues will be taken away from this debate, not only the narrow legal point.

Lord Desai: Before my noble friend replies, I add one element that is not moral but may be more economic. My noble friend uses the word "exploitation". Normally the consumer is unable to exploit; the producer may exploit the consumer, but it is very difficult for the consumer, with monopoly power, to do that. The Government want to punish the consumer for having exploited, because the exploiter is the producer whom the Government cannot catch. So it seems that if you catch the consumer you will by implication catch the person who is the real criminal. That is a bizarre way of doing business.

Lord Brett: My noble friend is a distinguished economist, but I do not necessarily accept on this occasion that it is not exploitation. Someone who goes with a prostitute who says, "By the way, I am not here because I want to be here—I am trafficked", and chooses to ignore that is clearly exploiting the individual. We are not seeking to punish the customer as such; we are trying to educate him so that he knows in law that he will commit an offence. That is the basis on which we go forward. I take entirely the point made by the right reverend Prelate; we will look at the situation in the round, without commitment to change, to see how we look at the matter with the advantage of having had a very full and well argued debate in several quarters. That is why I invite the noble Baroness to withdraw the amendment.

Lord Pannick: I ask the Minister a non-legal question, because I do not want to irritate the noble Lord, Lord Baker. The Minister said at the beginning of his reply that this is not a campaign to prohibit men from paying for sexual services but one to get men to desist from paying for sex with trafficked women. When the Minister goes away and thinks about this again will he think how that campaign, as defined by him, is really being advanced if the man is committing a criminal offence, even if he does not know—and he could not know, reasonably—that the woman has been trafficked? That is the point.

Lord Brett: I take on board the noble Lord's point as requested. "Trafficked" in that sentence is shorthand. In the clause we are looking at "coercion" and "trafficked" as a group, not simply at those who have been subject to trafficking.

Lord Maclennan of Rogart: Will the Minister undertake to provide the Committee with the legal representations that he has received to make such a fundamental change to the law? Will he also undertake to indicate the view of the professional organisations involved with the law, and, indeed, to list all the indications he has received? He keeps referring to "we" as being determined to do this, but so far the only authority he has mentioned in the debate backing his view is one Conservative Member of the House of Commons.

Lord Brett: First, the "we" is not the royal "we" but the governmental "we"—we in government. There is no intention to relate it to membership of this House. On the noble Lord's second point, I cannot provide the legal advice received.

Baroness Hanham: I thank all those who have taken part in the debate. I am extremely grateful to the lawyers here who have been able to support the amendment, or at least the elements of the amendment that we put forward. I am also aware that the Minister may have wished that he was somewhere else, as I know that it was wished to bring the Attorney-General in so that she could stand up to our noble friends and explain at some length and in some detail how this clause and this aspect of it has come about. The Minister might have been quite interested if he had seen the faces around the Committee as he gave his explanation of how this offence came about and how the campaign might develop as a result of it.
	I made clear from the outset that I had no interest in the moral or the campaign aspect. I said that I was interested wholly and entirely in the justice aspect. There have been many contributions from around the Chamber. I have not yet heard of one solid area where a defendant has no defence against something about which he can reasonably have no knowledge. If the Minister takes this away, this is the area that must be explained. It has to be explained why this offence, apart from the myriad offences that we have in this country, is so awful that it can have no defence. What is a person going to do? Is he going to go into a brothel and say, "Hello, just before we have sex, have you been trafficked? If you have I am going to have to go away again because I'm going to be prosecuted if somebody comes in". We have to get real about this. We have to be very sure that we do not muddle up a moral campaign with justice against somebody who is going to appear in a court of law and not be able to say anything in their own defence.
	We have rehearsed all this as much as we can. Both Ministers have to listen very carefully. My noble friend Lord Baker asked whether Clause 13 was relevant. We may come to that. We need to look at this. Trying to discourage an action that a majority of people are totally against may be laudable but it is quite outside the terms of the law and the legal way of going about things. I do not think we can have that.

Baroness Miller of Chilthorne Domer: Will the noble Baroness echo the request made by my noble friend Lord Maclennan that, before Report, the Minister gives the House the advice that he asked for?

Baroness Hanham: If the Minister can do that, it would be extremely helpful.
	I am sure that the Government are going to have to think very carefully about this. I hope that perhaps they will have second thoughts about this aspect. I accept the point made by the noble Lord, Lord Borrie, that my amendment may be deficient to some extent but, if this clause is going to go ahead, something like this has to come about. I shall see it come about at the next stage if something better does not appear in the mean time, like the Government having better thoughts about it. I thank everybody for their contributions. I beg leave to withdraw the amendment.
	Amendment 46 withdrawn.
	Amendment 47
	 Moved by Lord Brett
	47: Clause 13, page 15, line 36, leave out "used force, deception or threats" and insert "engaged in exploitative conduct"

Lord Brett: I shall also speak to Amendments 49, 51, 52, 55, 58, 59, 61, 62 and 64 in the name of my noble friend Lord West, and resist Amendment 48.
	As the Bill passed through another place there was considerable debate over the potential scope of Clause 13. I am not sure, not having been present, whether it was a greater or a lesser debate in intensity and range of views than that we have had in the past hour or so. It is fair to say that there was a large degree of consensus on the need to ensure that those who had been forced or coerced into providing sexual services to a sex buyer were given the full protection of the law. There was recognition that this is what we are trying to achieve with this offence. The Government are grateful for the constructive votes taken thus far.
	We responded to many of the concerns raised, particularly the fear that Clause 13, as originally drafted, was too wide and that its definition could go beyond the exploitative and coercive circumstances which the offence was intended to cover. It was suggested that it would also cover those who pay for sex with someone who had freely chosen to work in prostitution under the limited direction of a madam. We do not wish such circumstances to be covered by the offence. Therefore, to address this concern directly we have made amendments in another place to clarify the scope of the offence. These amendments make clear that the offence will cover those who pay for sex with someone who has been subject to force, deception or threats by another person acting for or in the expectation of gain.
	However, in making these amendments we recognise the need to ensure that they do not limit the protection offered by this offence too much. We do not wish the offence to apply only to those who have paid for sex with someone who has been subject to physical force or threats. It is important that we recognise the psychological pressure that can be used to coerce someone into prostitution, and the effect that this can have on people who may be vulnerable. For example, a person seeking to involve another person in prostitution, or maintain their involvement in prostitution, may threaten to report that person to the immigration authorities if they know that person to be here illegally, possibly because they have been trafficked; or threats to withdraw emotional or practical support may be used and may have a particularly pernicious effect on those who are in a weak position compared to the person making the threats or otherwise coercing the prostitute.
	To ensure that these circumstances are covered by the offence, subsection (4) currently states:
	"For the purposes of this section 'force' includes coercion by threats or other psychological means including exploitation of vulnerability".
	That wording was inserted by a Back-Bench amendment, which we accepted on Report in another place on the basis that the Government would tidy up the wording by amendment in this House. Consequently, we have introduced Amendments 47, 49, 51, 52, 55, 58, 59, 61 and 62, which will ensure that Clause 13 makes it an offence for a person to pay or promise payment for sex with a prostitute if a third person has engaged in exploitative conduct of a kind likely to induce or encourage the prostitute to provide the sexual services for which the sex buyer has made or promised payment. Under Amendments 52 and 62 a person engages in exploitative conduct if he or she,
	"uses force, threats (whether or not relating to violence) or any other form of coercion, or ... practises any form of deception".
	This wording will replace that used in subsection (4).
	I turn now to Amendment 48, which has been tabled by the noble Baroness, Lady Hanham, and the noble Viscount, Lord Bridgeman. This would remove the requirement for the third party who had been responsible for the force, deception or threats to be acting for or in the expectation of gain for himself or another person. It would appear, at least theoretically, to allow the offence to apply to a wider set of circumstances as it would not be necessary to establish that the third party had acted in order for himself or another to benefit financially. While there is an argument that it should be illegal to pay for sex with anyone who has been subject to force, threats or deception, regardless of whether such behaviour is motivated by financial gain, financial gain is a significant element of the exploitation that we are trying to target with this offence. The offence is aimed at those who create a financial incentive for traffickers and pimps to coerce or deceive people into providing sexual services as a prostitute. Reducing such demand therefore reduces the financial incentive for people to act as traffickers or otherwise coerce people into prostitution. The same does not apply where the third party is not acting for gain.
	We do not consider it likely that there would be many circumstances in which someone would behave in this way without the expectation of gain, although admittedly it is not inconceivable. I am therefore grateful to the noble Baroness and the noble Viscount for raising the issue. However, I hope they appreciate that, for the reasons I have set out, we are not inclined to accept Amendment 48.
	The amendments that we have tabled are an attempt to recognise the range of circumstances in which people are coerced into prostitution and to ensure that no vulnerable person who has been coerced into providing sexual services is excluded from the protection offered by this offence.
	At the same time, it is important that the scope of this offence is clear. We are grateful for the constructive attempts that have so far been made to ensure that this aim is achieved. It has inevitably been a dynamic process involving close scrutiny and reflection, but we believe that these amendments will help us strike the right balance. They address many of the views expressed in the other place and will ultimately ensure that the offence achieves its aim of protecting vulnerable people coerced into prostitution by tackling the demand for such prostitutes. I beg to move.

Baroness Hanham: As the Minister said, I tabled Amendment 48. I am extremely grateful to him for answering it before I have spoken to it. That is perhaps an unusual way of doing things. I have heard the response and perhaps he would like to hear what the amendment is about.
	The Government have tabled a number of amendments further amending their definition of what constitutes exploitation. The number of amendments that they have brought forward to this clause indicates just how difficult it is to express clearly what is to be considered unacceptable, and what is to be considered acceptable.
	The drafting of this clause is fundamental to the eventual implementation of this offence, and I am not sorry that the Government are taking some care over it. But let us go through it. We started at "intentionally controlled for gain"; then we moved on to,
	"used force, deception or threats",
	in the expectation of gain; and now we are looking at "engaged in exploitative conduct" in the expectation of gain.
	My amendment in this group probes why the question of gain is a material one in this offence. Off the top of my head, I cannot imagine a circumstance when exploitative behaviour is ever engaged in without gain to the exploiter, but even if such a situation existed, I cannot see that the question of whether there was gain matters one bit to the punter receiving the sexual services. Though the punter may very likely not know it, the prostitute involved is still being forced, threatened or deceived.
	This point has been put forward by Justice, which considers the expectation of gain irrelevant. I was going to ask the Minister whether he agrees with Justice that this offence should be targeted solely on the exploitation of the prostitute, but I think that he may have already answered me. For the interests of Hansard, however, perhaps he would like to answer me again.

Baroness Butler-Sloss: It gives me some pleasure to be able to commend the Government for this group of amendments, particularly the words "engaged in exploitative conduct". I have already declared an interest in relation to the All-Party Parliamentary Group on Trafficking, which is one of the areas where we learn from the police, and indeed from those who are trafficked, the wide variety of ways in which people may be exploited. As I think the Government understand, I entirely disapprove of Clause 13—I do not think that it should be in the Bill. However, if it is to be there, I very much commend the fact that the words have been given this much broader meaning. I also support the amendment tabled by the noble Baroness, Lady Hanham.

Lord Desai: I shall make a third attempt at this. This time, since I am going to support my noble friend, he might like what I say, although I am not changing my text.
	By adding the words about exploitative acts and gain from exploitative acts, my noble friend has made the distinction that I was trying to make. Exploitation consists of the producer who hires the worker making a gain. The consumer may valorise that exploitation by buying the product or service but the consumer does not actually exploit. That is the point that I was trying to make.
	Let us consider the very sad case of the Chinese workers who died in Morecambe Bay. They were trafficked and worked as winkle-pickers or whatever it was. Somebody was going to make a material gain from having trafficked them. If they had not died, the person who bought what they had collected from the sea would have been guilty of buying something produced by trafficked labour. It would be very sad if that person was prosecuted for, as it were, valorising the exploitation of Chinese workers.
	The same applies here. Someone is hiring women to supply a service for his or her gain. Someone goes and buys the service, not necessarily knowing the nature of the supply. I think that we should concentrate on the supplier and punish him for doing this for gain rather than punishing the consumer, who need not know that he has bought a dodgy service. I welcome the amendment.

Baroness Miller of Chilthorne Domer: In so far as we still have to discuss Clause 13, because we have not yet decided to get rid of it, I think that the government amendments move in the right direction by expressing at least some intentionality. However, although they are a move in the right direction, I am not suggesting to the Minister that we are any nearer to supporting Clause 13 as it stands, particularly in view of the previous debate. We will come back to this in the debate on clause stand part.

Lord Brett: I appreciate the contributions made and the support for the government amendments with which we are seeking to improve the legislation. It is true that sometimes you are criticised for not listening and changing your mind and sometimes you are criticised when you do listen and change your mind. That in a sense is why this House has improved much legislation over the years by giving it greater scrutiny than that provided in another place.
	I am not sure that I can add anything to what I said before about Amendment 48. As I say, we think that the use of financial gain is an important element in two ways. First, it is unlikely that there would be exploitation without financial gain. Secondly, it partly explains what we are seeking to do to protect the vulnerable women who are coerced or trafficked. They are trafficked for the financial gain of others, rather than themselves. We want the punters, as we colloquially call them, to understand why we are seeking changes of behaviour on their part, so that they do not seek to go with people who are coerced and they understand the difficulties of people in that situation. We have heard that a high percentage, in some cases 90 per cent, of prostitutes in major cities in Britain, not just in London, are suspected of being trafficked or certainly brought to this country with promises of financial gain.

Baroness Miller of Chilthorne Domer: I am sorry to interrupt the Minister, but this is one of the key issues for a number of us. Where has the Minister received that evidence from? On a previous amendment, I quoted to him very recent research, which I am sure he will look at. Where is he getting that figure of 90 per cent from? The noble Baroness, Lady Stern, and I visited Soho in preparation for this Bill. That was not what we saw. He may have been offered completely different evidence, but the evidence that we had did not come anywhere near showing rates of around 90 per cent—quite the reverse. The rates were probably between 10 and 15 per cent. I do not want to trade percentages with the Minister when there is no evidence, but I wonder where his evidence base has come from.

Lord Brett: I am sure that it would be more accurate to say "up to 90 per cent". The right reverend Prelate earlier mentioned figures in respect of prostitutes in London that included a very high element of trafficked women. I agree with the noble Baroness that it is not worth trading statistics. I will settle for saying that a substantial number of women in prostitution in this country are trafficked from abroad. We know that the figures on trafficking are horrendous enough not to have to worry too much about the statistics.

The Earl of Onslow: The Minister first said that the figure was 90 per cent and then said that he would trade that for "substantial". Basically what he means is, "I haven't the faintest idea what the percentage is". That is sloppy thinking at its worst. Will he please go and find out or ask his officials, who might have some idea?

Lord Brett: The noble Earl is correct about sloppy thinking. I have heard that in this Chamber, but not only from these Benches. I will indeed take his suggestion and seek harder evidence. The noble Baroness mentions evidence from research of which I have no knowledge. I agree that it is sensible at least to try to discover the scale of the problem. I will seek to provide that information to the noble Earl and send a copy to the Library.

Baroness Butler-Sloss: Before the Minister sits down, I should like to give him a little moral support. My understanding from the work of which I have learnt is that a substantial number of women are trafficked for prostitution from outside the United Kingdom. Also, a number of women are trafficked within the United Kingdom. Therefore the figures are perhaps greater than the noble Baroness, Lady Miller, suggested in her challenge.

Baroness Hanham: This has been an interesting little exchange, not all of it about the amendment. I am grateful for the contributions. Despite what the Minister said, I think that we will still disagree on whether gain is an important element. At the end of the day, the Minister has decided on a different approach. I accept that this is a difficult area and that is what we have ended up with. We may want to come back to the point about expectation of gain in due course, depending on what is decided on Clause 13. I just urge caution on the figures, because I have read a lot of briefings; they are all different and the figures depend on which ones you take on board.

The Lord Bishop of Chester: Perhaps I may put it on the record that I said that four out of five women—80 per cent—engaged in prostitution in London were foreign nationals. I did not say that they were trafficked, but it is safe to assume that a fair percentage of them may well be trafficked. Those figures come from a 2004 report by the POPPY Project, an organisation that works with such women.

Baroness Hanham: One of the dangers of this discussion is that the figures vary depending on who you are talking about, the evidence you are reading and where that comes from. No doubt the Minister will come back to us on where he received his information from. It is very likely that I will return to the amendment if Clause 13 returns to us. We may have more discussion on that shortly.
	Amendment 47 agreed.
	Amendment 48 not moved.
	Amendment 49
	 Moved by Lord Brett
	49: Clause 13, page 16, line 1, leave out "acted" and insert "engaged in that conduct"
	Amendment 49 agreed.
	Amendment 50 not moved.
	Amendments 51 and 52
	 Moved by Lord Brett
	51: Clause 13, page 16, line 6, leave out "used force, deception or threats" and insert "engaged in exploitative conduct"
	52: Clause 13, page 16, line 7, at end insert—
	"(2A) C engages in exploitative conduct if—
	(a) C uses force, threats (whether or not relating to violence) or any other form of coercion, or
	(b) C practises any form of deception."
	Amendments 51 and 52 agreed.
	Amendment 53
	 Moved by Baroness Hanham
	53: Clause 13, page 16, leave out lines 8 and 9

Baroness Hanham: We come to the last of the specific concerns that we and the interested organisations have with this offence—the level of fine that the Government consider appropriate to impose on a person found guilty of paying for sex with an exploited prostitute, without any element of defence.
	Unlike the noble Baroness whose amendments are grouped with mine, I have not selected an appropriate level that I think this offence warrants, for the simple reason that it all depends on whether the Government accept our arguments on the question of strict liability. That will determine which way this goes. If we win our argument on strict liability, I would agree entirely that the level of the offence should be raised significantly to reflect the severity of the crime. If there is no strict liability, there will be a serious offence for which for which there is a defence.
	The ridiculously low level of the proposed fine shows just how weak this offence will be if it is implemented in its current form. The Government's insistence on a strict liability offence means that those who actively seek out trafficked prostitutes or those who simply do not care that the prostitute is clearly exploited can receive a fine of only up to £1,000. In most cases it will be less.
	The level of the fine clearly demonstrates that, as currently drafted, the offence will fail. Despite all the arguments used by the Minister, he must appreciate the damage that such a desultory fine, as well as the strict liability aspect, would do to the reputation of our justice system. We will need to look again at the level of sentence if we end up with strict liability, which I hope we will not. In the mean time, it will be interesting to hear from the Minister why this level of fine has been set. I beg to move.

Baroness Miller of Chilthorne Domer: Our Amendments 54 and 63 are in this group. The logic of the noble Baroness, Lady Hanham, is absolutely correct: until we have settled the issue of strict liability, it is probably not desirable to debate this matter at great length. We tabled our amendments on the premise that we had got rid of the idea of strict liability. There needs to be a tariff to reflect the seriousness of the offence, whereby the accused would be able to have a normal court hearing, a normal defence and, if found guilty, pay the sort of penalty that such an offence would merit. The main debate about the level of the offence would be better held on Report, when we have resolved the issue of strict liability.

The Earl of Onslow: My name has been added to this amendment, which seems to help the Government in their absolutely justifiable attempt to deter people from paying for sex with trafficked women. If a defence is available, the punishment for finding someone guilty should be much higher than it is in the Bill. That, I suggest, would be a bigger deterrent from playing about with trafficked women than the Government's strict liability element. I may have been a bit harsh on the Minister. If I was, I certainly apologise—perhaps I should not have been as harsh as I was. The point is that we are on his side in what he wants to do but we think that he is going the wrong way about it.

Lord Brett: As has been said, Amendments 53, 54 and 63 would increase the maximum penalty for the offences created by Clauses 13 and 14 from a fine of £1,000 to 14 years' imprisonment. This issue was debated in another place, where, as here, it was linked with other amendments which sought to remove the strict liability element of the offence and to replace it with a requirement to prove that the defendant knew that he had been with a prostitute who had been subject to force or deception. These amendments are therefore based on the new mental element that, in the view of the Official Opposition, should be introduced into the offence, which is why they wish to increase the maximum penalty for such an offence.
	In the other place, it was also argued that the offence of having sex with someone who had been forced in some way was the equivalent of rape and should be treated as such. However, this offence is distinct from rape because there is no requirement to show that the defendant knew or ought to have known that the prostitute was threatened or deceived; hence, under strict liability we intend to give what we consider to be an appropriate penalty of a fine. That would be consistent with the penalties for similar offences, such as kerb-crawling, and in our view it would tackle the demand for prostitution. If someone has sex with a person who does not consent and they do not reasonably believe that that person has consented—

Baroness Butler-Sloss: Perhaps the Minister will be kind enough to give way. I apologise for interrupting. As I understand it, the only purpose of both the amendments put forward by the noble Baronesses, Lady Hanham and Lady Miller, is if there is no strict liability element. Therefore, perhaps I may respectfully ask whether it is necessary to go through all this, because the issue arises only if the Government accept that there should not be a strict liability element.

Lord Brett: The noble and learned Baroness is correct. I was trying to explain how this measure developed during the discussions in the other place. As such, we do not believe that it would be appropriate to amend the offence in this way. However, I recognise that it is dependent on strict liability and I therefore ask the noble Baroness to withdraw the amendment, as we will return to it later if events unfold.

Baroness Hanham: We will certainly return to it later, depending on how Clause 13 goes. First, I am now a little more concerned that we have an educational campaign going here, one way or another, with offences and fines, and, secondly, I am even more puzzled that the offence should be equated to kerb-crawling. The Minister has made such an effort and has gone into such detail on the whole strict liability area and on the seriousness of the offence that it seems to have been taken above kerb-crawling. However, I am sure that we will come back to this area and I beg leave to withdraw the amendment.
	Amendment 53 withdrawn.
	Amendment 54 not moved.
	Amendment 55
	 Moved by Lord West of Spithead
	55: Clause 13, page 16, leave out lines 10 and 11
	Amendment 55 agreed.
	Debate on whether Clause 13, as amended, should stand part of the Bill.

Baroness Miller of Chilthorne Domer: We had an extremely good debate about Clause 13 on the first two groups of amendments and I do not propose to weary the Committee by rehearsing any of that debate. The cavalry also arrived in the person of the noble and learned Baroness, Lady Scotland of Asthal, who I know caught up a little with where we had got to in our debate and consulted the Minister and those in the Box. However, she is not in her place at the moment. Given what the Minister has said, it would probably be more constructive if I were to read Hansard and, between now and Report, see what the Minister comes back to us with. I hope that the Government will think about withdrawing the clause. They have heard from all Benches around the Committee the extreme disquiet that exists about this clause and at this point I do not think that it would be to the Committee's advantage if I were to extend the debate.

Baroness Stern: I support the noble Baroness, Lady Miller, in her opposition to Clause 13. Although I accept her proposal that we should look forward to some changes, together with the fact that we have discussed most of this issue, I should be very much happier if I were able briefly to put on the record some of the research findings on this matter. There have been moments when we have not seemed entirely clear what we are talking about when we have discussed the difference between people who have been forcibly trafficked and held against their will—for example, in the sort of conditions suffered by the young woman from the Czech Republic, as described by the noble and learned Baroness, Lady Butler-Sloss—and women who do not have British nationality, who are perhaps in London, either legally or illegally, and who have chosen to make their money by working in the sex industry rather than in some other low-paid job that might be available.
	Therefore, I want briefly to put on the record the findings of the ESRC project on migrants in the UK sex industry. Those findings are to be published shortly and are based on in-depth interviews with 100 individuals without British nationality working in the sex industry in this country. The conclusions are that, for many of them, working in the sex industry is preferable to other very low-paid jobs that they might be able to do, mainly working in restaurants. Many of them are able to earn substantial amounts of money in this country, which helps them to keep their families alive in their own countries. In Soho, the noble Baroness, Lady Miller, and I met some people who work in the sex industry. It was clear that the amount of money that they could earn in the sex industry in Soho would make the standard of living of their families in the countries from which they came very much higher. That is an important point. All the people interviewed in this study felt that they were very vulnerable and that plans to criminalise sex work would make them more vulnerable.
	Another piece of research, with which I am sure the Home Office is familiar, was carried out by Teela Sanders and Rosie Campbell. Their report, "Designing out vulnerability, building in respect: violence, safety and sex work policy", is based on extensive fieldwork in two cities in the UK outside London. They make the point that the people most at risk of violence are those working on the street and that those working on the street are those who already come from backgrounds of violence and abuse. They also found that,
	"zero tolerance style policing and policies against sex workers and men who buy sex",
	lead to an increase in violence.
	There is considerably more research available than that, but it seemed that it might be helpful to the Committee if some of the information were at least on the record so that we could be clear that it exists and that it is helpful to use research when it is available.

Baroness Hanham: I want to comment briefly on what has been said by the noble Baroness, Lady Miller. The Government need to decide what they are doing with Clause 13. The problem is whether the Government are involved in supporting a crusade against prostitution or whether they are trying to define a particular aspect of an area that is difficult for us all to understand or accept. Are they going outside the normal areas of law and justice to pursue, or help to pursue, a campaign that we have identified today? I very much hope that we can have some discussions before coming back on Report, which is a long way off. It may be helpful to exchange views, but if we do not and things do not change, Clause 13 will receive a pretty rough ride when it reappears.

Lord Brett: The noble Baroness could say that Clause 13 has received something of a rough ride already. I could make a long contribution but I take the point made by the noble Baronesses, Lady Miller and Lady Hanham, about returning to this on Report so that the Committee might make some progress. I shall therefore restrict my comments to saying that I acknowledge that some people freely choose to sell sex. I also know that many involved in prostitution have little choice about their involvement and would leave it if they could. We cannot ignore them and we must do all that we can to protect these victims of exploitation and abuse.
	I hope that the Committee can accept the important principle that coercion and threats of a non-physical nature could become a definition of exploitative conduct. I shall not rehearse the discussion we had on strict liability, but I hope that we can make progress and not divide today on the Question of Clause 13 standing part of the Bill.
	Clause 13, as amended, agreed.
	Clause 14 : Paying for sexual services of a prostitute subjected to force etc: Northern Ireland
	Amendments 56 and 57 not moved.
	Amendments 58 and 59
	 Moved by Lord West of Spithead
	58: Clause 14, page 16, line 20, leave out "used force, deception or threats" and insert "engaged in exploitative conduct"
	59: Clause 14, page 16, line 23, leave out "acted" and insert "engaged in that conduct"
	Amendments 58 and 59 agreed.
	Amendment 60 not moved.
	Amendments 61 and 62
	 Moved by Lord West of Spithead
	61: Clause 14, page 16, line 28, leave out "used force, deception or threats" and insert "engaged in exploitative conduct"
	62: Clause 14, page 16, line 29, at end insert—
	"(2A) C engages in exploitative conduct if—
	(a) C uses force, threats (whether or not relating to violence) or any other form of coercion, or
	(b) C practises any form of deception."
	Amendments 61 and 62 agreed.
	Amendment 63 not moved.
	Amendment 64
	 Moved by Lord West of Spithead
	64: Clause 14, page 16, leave out lines 33 and 34
	Amendment 64 agreed.
	Clause 14, as amended, agreed.
	Clause 15 : Amendment to offence of loitering etc for purposes of prostitution
	Amendment 65
	 Moved by Baroness Miller of Chilthorne Domer
	65: Clause 15, page 16, line 39, after "person" insert "aged 18 or over"

Baroness Miller of Chilthorne Domer: The amendment has been proposed by the Standing Committee for Youth Justice, the Joint Committee on Human Rights and Justice. It would exempt children from the offence of loitering or soliciting for the purposes of prostitution. The Government have repeatedly stated that involving children in prostitution is a form of child abuse, so it would be regrettable if they did not abolish the power to prosecute a child over the age of 10 for offences under Section 1 of the Street Offences Act 1959, which the Bill amends.
	We are not convinced by the Government's explanation of the continuing need for the criminalisation of children involved in prostitution. I shall give the Minister an example of that in a moment. That explanation is in direct opposition to the conclusions of the UN Committee on the Rights of the Child. In particular, we are not persuaded by the assertion that the criminal justice system may be needed to enable children to access support. The provision of revised guidance is insufficient to address our central points of concern, and we recommend that the Government reconsider their opposition to decriminalising children involved in prostitution.
	We certainly think that children and young people have the right to be protected from all forms of sexual exploitation, and we heard earlier from the right reverend Prelate about the sexualisation of children. We have heard several times in briefings about the increase in all forms of exploitation of children, paedophile rings and many worrying things. Surely the answer is not to leave the victims—the children—criminalised, which is what the Bill proposes.
	In 2005-06, Barnardo's sexual exploitation services worked with 2,148 young people aged between 12 and 24. Research undertaken in 2005 indicated that as many as 1,000 young people in London alone were at risk of, or involved in, exploitation. We accept that it is a big problem. Research shows that children likely to be most at risk of sexual exploitation are those who have had a disrupted family life, have been in care, which is certainly a risk, have had a history of abuse or disadvantage, or are runaways.
	The sexual exploitation of children takes many forms that may include formal prostitution, but it has only relatively recently been recognised that children and young people who would once have been referred to as child prostitutes should be seen and treated as abused children in need of care and protection. Our amendment seeks to build on that recognition by removing the fact that children can still be prosecuted. The Minister will say that the number of children aged under 18 who have been prosecuted under Section 1 of the Street Offences Act is extremely low—just one prosecution and two cautions in 2005—but that is an argument to remove it from the statute book. If it is not much used, but it still criminalises children for something when they should be seen as the victim, that is a stronger argument for removing it.
	Britain had an appalling report from UNICEF on the state of children in this country. We must constantly bear it in mind that we should be improving their position. When the Bill was discussed in the other place, the Minister, Alan Campbell, in refuting the idea of decriminalising under-18s, said that,
	"decriminalising under-18s would risk sending out a message that we do not think it is acceptable for adults to be involved in street prostitution but that somehow it is acceptable for a child or young person to loiter or solicit for the purposes of prostitution. If one child is deterred from getting involved in prostitution because they would be at risk of breaking the law that would justify our position".—[Official Report, Commons, 19/5/09; col. 1414.]
	We refute absolutely that that is a logical or reasonable position to take. It demonstrates a completely flawed understanding of the situation in which children who are sexually exploited find themselves. They do not choose to be involved; they have landed in a situation because they are vulnerable, have no money, are homeless or people have preyed on them. They need care. We cannot continue criminalising in this way those who are under 18. I beg to move.

Baroness Hanham: I support the noble Baroness, Lady Miller, in her amendment. It is entirely wrong that any child should be criminalised and taken to the youth court in this way. If anybody needs to be taken out of the system, it is a child under 18, so that this does not become part and parcel of their lives for ever.
	We should be looking at much better ways of rehabilitation for such people or more diversionary ways to deal with the problem. As the noble Baroness said, there are many reasons behind what is happening. I support the amendment and hope that there are other ways to deal with the problem.

The Earl of Onslow: If a child is involved in prostitution, that child is deeply damaged, deeply hurt and in great danger. To make a child like that into a criminal strikes me as cruel in the extreme. Surely, it is a question of "suffer little children". We should look after them and ensure that they are given care and help, rather than putting them into the criminal system. It is mad to put them into the criminal system.

Lord Borrie: The noble Baroness, Lady Miller, who introduced the amendment, and the noble Baroness, Lady Hanham, have spoken with reasonableness and concern for the children involved. So has the noble Earl, Lord Onslow. "Suffer little children", he said. There may be a paradox, in that to continue to bring the child into the criminal system sounds terrible, but it may result in benefits. There is not a great deal of advantage in pretending something that is not. The child concerned, who is loitering for prostitution, is a child prostitute—although you may wish to label it something else. There may be advantages in continuing with the system so that help shall be given and the child shall be taken away from prostitution, but I am not sure that the amendment helps.

Baroness Stern: I support the amendment to which my name is attached and thank the noble Baroness, Lady Miller, for moving as she did. The United Kingdom's human rights obligations make it absolutely clear that children who are involved in sexual exploitation should not be deemed as committing criminal acts. It is difficult to understand why the Government resist the amendment in the light of the efforts that they have made over the years to safeguard and protect children.
	There have been two arguments. The first is the one echoed by the noble Lord, Lord Borrie, that there may be exceptional cases where criminal justice intervention is necessary to prevent a harmful situation and allow a child to access support. That was the point made by the Minister in the Public Bill Committee in the other place. Indeed, the Government have from time to time tried to assert that criminalising people is not a bad thing but a helpful way to get them access to the services that they need. As I understand it, that was the approach taken by the noble Lord, Lord Borrie. I oppose that position. It is important to state that criminalisation is not an acceptable way to help people. The Joint Committee on Human Rights stated:
	"We find it surprising that the Government proposes to rely on the criminal justice system to address institutional or individual failures within the services available to children and young people. It appears to us to be more appropriate to strengthen their duties and capabilities of children's services to respond to children involved in prostitution".
	The confidence that the Government have in the benefits of criminalisation alarms me. Criminalisation gives people a criminal record, which limits their chances and choices for the rest of their lives. That is particularly important when we are talking about people aged under 18, who we hope will be able to live their lives without some things that they have done in their youth being held against them.
	The second argument made by the Minister has already been referred to by the noble Baroness, Lady Miller: that by decriminalising we shall be sending out a message that it is somehow acceptable. With enormous respect to the Minister who made that suggestion, that is an absurd misunderstanding of the nature of deterrence. The young people going into that form of exploitation are not asking themselves what is the law in this country regarding prostitution.
	Reference has been made to the work carried out by Barnardo's about sexually exploited young people. Its work found that young people are in prostitution because of a lack of choice, because they are socially, emotionally and economically vulnerable. They have been failed by services at an early stage in their lives. The key point is that Barnardo's list of effective work with those young people includes giving them attention. In the words of Barnardo's, they have few, if any, concerned attentive adults in their lives, so they are attracted by the attention that they get from the adults who then go on to exploit and abuse them. For all of us, that is a sad prospect and is illustrative of how inappropriate the Government's argument for retaining the criminalisation of such young people is.
	The noble and learned Baroness, Lady Butler-Sloss, had to leave but, as she could not be here, she asked me to put on the records that ECPAT UK is very concerned that the Committee should take seriously the points made about the decriminalisation of children involved in prostitution.

Baroness Morris of Bolton: I was unable to speak on Second Reading, but I have been following the proceedings of the Bill very carefully. I very much support the noble Baroness, Lady Miller, and the comments of my noble friend Lady Hanham.
	These children come from broken families where there is violence. They are often homeless. They turn to drugs and shoplifting and enter prostitution. As the noble Baroness, Lady Miller, said, many of them have been in care. There is recent evidence that the sex industry has been targeting children leaving care, and who are then trafficked within our borders into the sex industry. If those children and young people go into prostitution, we as a society have let them down. We should be doing all that we can to protect them, not to criminalise them.

Lord Ramsbotham: I rise to support the amendment, and especially the comments of my noble friend Lady Stern. I remind the Committee of the observations of the UN Committee on the Rights of the Child. It stated:
	"The State party should always consider, both in legislation and in practice, child victims of these criminal practices, including child prostitution, exclusively as victims in need of recovery and reintegration and not as offenders".
	That is important because, if you treat them as offenders, you are likely to deter them from seeking assistance from the authorities, which plays into the hands of the abusers. Therefore it is essential that we do not criminalise them.

Baroness Howe of Idlicote: I, too, support the amendment moved by the noble Baroness, Lady Miller. It re-emphasises the fact that these are children that we, between us, have failed. They are victims. We have failed them either as parents, as carers, or as the state. As we know from plenty of evidence, it is those who have been in care who, alas, are most likely to end up in that situation. There is a lot more that we need to do, but one thing that we do not need to do is give them a criminal record. It makes every sense that there is no criminalisation, no offence to be committed for those aged under 18. That is how the Government should go forward. There is plenty more we can do. I thought the point about the need to have someone to take an interest in the child—literally, somebody to love; it is as simple as that—is important. We should be finding mentors to point out to them other ways of developing their lives from then onwards. I support the amendment.

Lord Brett: Amendment 65 concerns an extremely important issue in relation to the offence of loitering and soliciting for the purposes of prostitution, which Clause 15 will amend. The amendment changes the law so that children cannot be prosecuted for the offence of loitering and soliciting. It clearly concerns not only the noble Baroness but a number of noble Lords and many people outside this House. Many favour changing the law in the way suggested in the amendment. We take seriously the concerns of the Joint Committee on Human Rights and children's organisations, among others, who argue for decriminalising children in relation to this offence. We have considered this matter fully and taken account of the full range of views. Having done so, on balance, we have decided to retain the current law.
	I should start by emphasising that we accept the principle that children who become involved in prostitution are victims of a sexual offence and should be offered appropriate support. We set out our approach in our guidance Safeguarding Children Involved in Prostitution, which was originally issued in 2000, and we maintain that position in the latest version of the guidance, which was published earlier this month. As a consequence of this guidance and the approach it sets out, this offence is used against children very rarely. Between 2004 and 2007, a period of four years, five convictions and five cautions were given to under-18s for this offence. The noble Baroness said that in 2000, the latest year for which statistics are available, there was one conviction and two cautions. My brief states that there was one conviction and one caution. It is clear that, in practice, this offence is used extremely rarely in relation to under-18s. In the overwhelming majority of cases, they are treated solely as victims of a crime.
	Nevertheless, we believe there are reasons in favour of retaining this offence. Alan Campbell, the Minister in the other place who has been cited, made the point that decriminalising under-18s could risk sending out a message that we do not think it is acceptable for adults to be involved in street prostitution, but we consider it acceptable for a child or young person to loiter or solicit for the purposes of prostitution. Retaining the offence may therefore deter some children from engaging in street prostitution in the first place. The noble Baroness, Lady Morris of Bolton, spoke about children being targeted on leaving care. One of the things we are concerned about is that abolishing the offence would risk encouraging pimps to target those children in order to take advantage of the fact that children engaged in prostitution could not be arrested by police if they were found loitering or soliciting.
	Noble Baronesses made the point that in exceptional cases support from other agencies has been made available but has not been accessed or has not been effective in helping the child exit street prostitution. In some cases, we believe the intervention of the criminal justice agencies may be vital in ensuring the removal of that child or young person from a situation of danger and initiating engagement with support services. It may be that this intervention is the most effective in leading the child to engage with the appropriate support agencies, given the failure. It is not necessarily failure on the part of the agencies; it may simply be that the child has decided that it does not want to co-operate. This is an opportunity to give a boost to the rehabilitation that we are seeking to achieve with the new rehabilitation penalties that we are creating in Clause 16.

The Earl of Onslow: If this is such an effective method of getting people into the system, why has it been used only five times?

Lord Brett: Because in the vast majority of cases we see and treat the victims as precisely that. In only five cases was there a need for prosecution or caution of under-18s in the period 2004 to 2007.
	I accept that the argument is finely balanced. We have considered at great length the issues at stake. However, we have concluded that the arguments in favour of maintaining the current position and the potential risks in amending the law force us to the view that we wish to maintain it. That view is supported by ACPO and the CPS. I hope I have set out clearly the reasons why the Government have concluded that we do not wish to meet the noble Baroness's wishes. I hope she will withdraw her amendment.

Baroness Miller of Chilthorne Domer: I thank all noble Lords who have spoken, especially those who put their name to my amendment. The noble Baroness, Lady Morris of Bolton, spoke very movingly about the issues of broken families and drugs. The noble Baroness, Lady Howe, said that we have corporate responsibility, as I would call it, for these children. Given the fine balance that the Minister mentioned, I am surprised that he has continued to come down on the side of retaining this provision. I was given some hope when I read the comments of the noble Baroness, Lady Morgan of Drefelin, who was looking at this issue from the point of view of the Department for Children, Schools and Families when giving evidence to the Bill Committee in the other place. She agreed that a child prostitute is a victim, not a criminal. However, she did not recommend decriminalisation. Clearly, the Government are finely balanced on this issue.
	The Minister has advanced no evidence from ACPO or anyone else about why this is more helpful. This morning—it seems a long time ago—I heard on the "Today" programme that there is very little provision. In the whole of the UK, there are just 56 beds for runaway children. It is not surprising that they end up on the street. If they do not want to be put straight back into care, and there are often substantial reasons why they have run away from home or care, they have no hostels. Just 56 beds is underprovision of an enormous sort, so runaways are already more vulnerable.
	We shall certainly return to this issue on Report. The noble Lord, Lord Borrie, mentioned a paradox but, apart from that, I did not hear any support for the Government's position, so I imagine that the balance will go against the Government on Report. In the mean time, I beg leave to withdraw the amendment.
	Amendment 65 withdrawn.
	House resumed. Committee to begin again not before 8.38 pm.

Child Support Collection and Enforcement (Deduction Orders) Amendment Regulations 2009

Copy of the Regulation
	16th Report from JCSI

Motion to Approve

Moved By Lord McKenzie of Luton
	That the draft regulations laid before the House on 3 June be approved.
	Relevant document: 16th Report from the Joint Committee on Statutory Instruments.

Lord McKenzie of Luton: My Lords, I beg to move that the draft Child Support Collection and Enforcement (Deduction Orders) Amendment Regulations 2009, which were laid on 3 June 2009, be approved.
	Noble Lords will be aware that some non-resident parents are determined not to accept financial responsibility for their children. Unfortunately, they demonstrate this by failing to pay their child maintenance and building up arrears. The Child Maintenance and Enforcement Commission already has a number of tools it can use to enforce payment when this happens. For example, it can use a deduction from earnings order, which is an effective method of collecting both ongoing liabilities and arrears in many cases. However, in some cases, a deduction from earnings order cannot be used or is ineffective; for example, because the non-resident parent is self-employed or frequently changes jobs. The Government want the commission to be able to take quick and effective action to enforce payment of child maintenance in all cases where a non-resident parent is failing to comply. With this is mind, we set out our proposals for tougher enforcement in our White Paper, A New System of Child Maintenance, in December 2006.
	Subsequently, the Child Maintenance and Other Payments Act 2008 inserted powers into the Child Support Act 1991 which would allow the commission to use deduction orders to collect child maintenance from an account held by a non-resident parent with a deposit-taker or from funds held by a third party. Because deduction orders will be administrative they can be made without going to court first and can therefore get money flowing for children more quickly. They will provide an additional tool that can be used alongside existing methods of collection and enforcement.
	The regulations before us today will implement the powers taken to enable both regular and lump-sum deduction orders to be used on accounts held by deposit takers, which will normally be banks or building societies. These regulations do not make provision for deduction orders to be used on funds held by third parties, such as solicitors. The commission has decided to use deduction orders on bank and building society accounts first because it believes that orders on these accounts have the greater potential for collecting child maintenance. The regulations have therefore been developed in close consultation with representatives from the banking sector which will be responsible for operating the orders. The commission will go on to assess the scope for further regulations which will enable it to use lump-sum deduction orders on funds held by third parties. This will involve working with a number of stakeholders, including solicitors and other government departments.
	I should make it clear that, where there are arrears of child maintenance, the commission will do all it can to make an arrangement with the non-resident parent to pay those arrears before a deduction order is made. The commission would much prefer child maintenance to be paid, for example, by direct debit, which will not incur any additional charge for the non-resident parent and is much easier and cheaper for both the commission and the deposit-taker to administer. However, if the non-resident parent fails to make a satisfactory arrangement to pay, the commission will use what information it has to first liaise with deposit-takers in order to identify a suitable account on which to make an order. In doing so, the commission will ensure that it does not make an order on an account which is specifically excluded by the regulations. This would apply where, for example, the non-resident parent has no beneficial interest in any of the funds in it because they are operating it solely as a trustee.
	The regulations also prevent the commission from making a lump sum deduction order on an account which is used wholly or in part for business purposes. However, it may make a regular deduction order on such an account, but only where it is used by the non-resident parent as a sole trader. If the Commission decides to make a regular deduction order, the deposit-taker will be required to deduct regular amounts of ongoing maintenance and/or arrears from the non-resident parent's account. The commission will send a copy of the regular deduction order to the deposit-taker, specifying details of the account, the amount, the dates on which deductions are to be made and when it will take effect. A copy of the order will also be sent to the non-resident parent. The deposit-taker will have a legal duty to make deductions from the account specified in the order and pay the relevant amount to the commission. The deposit-taker will also be able to deduct an amount up to a maximum of £10 towards its administrative costs before making each deduction. This takes account of the fact that deposit-takers will be required to process deduction orders manually because they operate differently from direct debits and standing orders and cannot be automated.
	Safeguards will be in place to protect both the non-resident parent and the deposit-taker. The amount of each deduction will not exceed 40 per cent of the net weekly income used in the current maintenance calculation, and the deposit-taker must not deduct an amount that will put the account into overdraft. The regulations also set out clearly the circumstances where either the non-resident parent or the deposit-taker can apply for a review of a regular deduction order. This includes, for example, where there has been a change in the amount of the maintenance calculation in question or an incorrect amount has been specified in the order due to an error. Both the non-resident parent and the deposit-taker will have a right of appeal to a county court—or sheriff in Scotland—against the making of the order and against a decision following an application to review the order. If the commission decides to make a lump-sum deduction order the deposit-taker will be required to deduct a lump sum from the non-resident parent's account in respect of a specified amount of arrears. The order will operate in a similar way to a third-party debt order from a court but, because it is administrative, the process will be quicker.
	The primary legislation makes provision for a number of safeguards in respect of lump sum deduction orders and the regulations set them out as an integral part of the process. The commission will initially send the deposit-taker and the non-resident parent a copy of an interim order which will specify details of the account and the arrears to be collected by a final order. The interim order will also instruct the deposit-taker to freeze up to the amount specified in the order. Both the non-resident parent and the deposit-taker will have 14 days to make representations to the commission against the proposals in the interim order.
	At any point throughout the process, from receipt of the interim order until the funds are paid to the commission, both the non-resident parent and the deposit-taker may apply to the commission for consent to release some or all of the funds from the account. The non-resident parent might do this where, for example, there is an existing written contractual obligation to make a payment to another party. The deposit-taker might do it where, for example, it already has a written agreement with the account holder that a specific amount in the account is held as security against a loan.
	A robust appeals process will also be in place. Both the non-resident parent and the deposit-taker will have a right of appeal to a county court—or sheriff in Scotland—against the making of the order and a decision following an application for consent to release funds. The commission will not make a final order until the time allowed for an appeal, 21 days, is passed and will not instruct the deposit-taker to transfer funds until any appeal against the making of the final order is resolved. The deposit-taker will have a legal duty to comply with the requirements of the order and pay the specified amount to the commission. The deposit-taker may also take up to a maximum of £55 towards its administrative costs before making the payment to the commission. This aligns with the amount a deposit-taker can currently take for administering a third-party debt order made by a court which requires deposit-takers to follow a similar process.
	Noble Lords should be aware that the new powers inserted into the 1991 Act made provision for regulations to allow both regular and lump-sum deduction orders to be made on a joint account. However, these regulations do not include such provisions. We recognise that these new powers are unprecedented and, therefore, the commission will use them carefully, particularly on initial implementation. That is why the safeguards are built into the process. It is also why the commission is planning to start to introduce deduction orders using a small dedicated team so that implementation will be at a low volume and controlled.
	The impact assessment, which was published alongside the draft regulations, says that this policy will be fully evaluated by the commission in September 2010. If that evaluation finds evidence that excluding joint accounts from the scope of deduction orders is reducing their effectiveness, we will introduce further regulations to extend provisions so that orders can be made on joint accounts. The evaluation will also enable the commission to collect information which will allow it to assess the potential for and likely benefits of increasing the number of deduction orders made in the future. In the mean time, the provisions in these regulations will enable the Child Maintenance and Enforcement Commission to start to use deduction orders both as an additional enforcement tool and as a means of encouraging ongoing compliance.
	My Lords, I am satisfied that the statutory instrument before us is compatible with the European Convention on Human Rights and I commend the regulations to the House.

Lord Taylor of Holbeach: My Lords, I thank the Minister for introducing these regulations. We on these Benches understand why the Government have brought them forward. My honourable friend Mr Andrew Selous supported them in another place, and they have our support here.
	These measures might be sensed to have a draconian feel about them, but the estimate of £2 million raised in the first year is mere drop in the ocean compared to the £3.8 billion owed by non-resident parents—a figure growing by £10 million a month. It would be of interest if the Minister could tell us how many parents caring for their child do not get any of the money to which they are entitled from the non-resident parent.
	Electronic tagging in extremis to impose a curfew or the ability to remove travel documents or passports, should that come about, represent considerable powers, although, of course, the latter would be effective only where UK citizens are concerned. Perhaps the most significant move is to put for the first time into law the power to access directly a citizen's bank account and to remove money to give it to that person's child or children. I think I understand the process by which accounts of individuals and sole traders will be accessed, but not individuals trading as companies and partnerships, or anyone with joint accounts. Does not the Minister expect that this loophole—or gaping chasm, one might think—will be quickly discovered and that partners will soon be appearing on bank accounts to render them out of reach? I understand that accounts held on behalf of clients by solicitors are also protected. The rationale may be right but it is another way out for recalcitrant parents.
	I also note that an administration fee will be charged. The Minister talked of this. How will the department calculate this and will it be charged irrespective of circumstances and the amount involved? Meanwhile, the cost to the banks and building societies of providing information requests and delivering money will be considerable. Has this been properly estimated by the Government and are the deposit takers satisfied?
	This operation to address the huge shortfall of recovering overdue moneys will in future be in the hands of the Child Maintenance and Enforcement Commission. How will CMEC go about sequencing deduction orders and what will be its priority?
	I hope that the Minister will endeavour to address my concerns. If they are not covered in his response, perhaps he will give noble Lords the answers in writing. He might also tell noble Lords how the review promised for 2010 will be analysed, shared and debated. At the beginning of my remarks I indicated my support for these regulations. I hope that the Government have got it right and that a future Government will not be forced to return to this issue.

Lord Kirkwood of Kirkhope: My Lords, it is a pleasure to follow the noble Lord, Lord Taylor of Holbeach. I am happy to concur with him that these orders should proceed. In his very important penultimate point, he asked what would happen with regard to the 2010 CMEC review. I certainly hope that it will be published. It is very important to debate these powers, particularly in the early years as we see how they pan out in practice. The commission should understand that Parliament does not provide administrative powers of this kind—I think that the Minister mentioned unprecedented powers—lightly. We will be watching very closely to see how they work and whether they achieve the policy aim and are used in a fit and proper manner, as was intended in Sections 22 and 23 of the Child Maintenance and Other Payments Act 2008. I concur that the House will want to keep a watching brief as these regulations start to be implemented.
	I remember vividly the good debates that we had when discussing Clauses 22 and 23 of the 2008 Bill, as it then was. I was very clear in my own mind that these powers were required for self-employed people. Non-resident parents who are subject to contracts of employment are much easier to handle if they are acting in bad faith in seeking to elide payments for their children. Deduction of earnings orders are a far easier, simpler, better understood and better controlled process. The evidence that was laid before the House last year certainly convinced me that the Child Maintenance and Enforcement Commission required specific powers where self-employed people were involved, as the quantification of where the money and the assets were was very much harder to ascertain and took time to establish. The people who suffer most as a result of that are the children who do not get the money to which they are entitled under the legislation.
	Self-employed cases represent only 8 per cent of the caseload. I have studied this matter since 1991. I keep saying that I have no alibi. I was there at the time and I feel deeply responsible for the legislation, which has been so fraught in its many manifestations. However, that percentage represents 96,000 self-employed, non-resident parents with liability outstanding. That is a big caseload which needs to be dealt with. I hope that these powers will be used proportionately. I agree that they are necessary but they must be used very carefully indeed. Non-resident parents who are in the sights of the commission using these new administrative procedures need to understand clearly what is facing them before it is safe to use these powers. In that regard I do not think that sending a copy of the interim order to the deposit holder does that by itself. The Minister may say that there will be a letter. It may be only one page of A4 but it needs to make crystal clear that the new system will be different. These parents may have struggled with the old CSA, now CMEC, for years. Indeed, a lot of them have. Some of them have acted in worse faith than others, but this is a different procedure altogether. Simply providing a photocopy of a legal document, which is probably quite impenetrable to people who are untutored in these things, is not sufficient in my view unless it is accompanied by something which explains in plain Queen's English what is now facing the people against whom these powers will be arraigned.
	I also think that the accuracy of the system—I want to come back to this in a minute—still leaves a lot to be desired. I have real fears that although most of these orders will be used against people who deserve to have them imposed, some who do not fall into that category may get caught up in these provisions. Therefore, we need to be careful to make the system as accurate as possible. The Minister said that these unprecedented powers need to be used with care. I say amen to that. I like to think that they will be used only as a last resort; that is, when there is no other way to get the non-resident parent to face up to his or her responsibilities. Establishing a case against any such non-resident parent who is the subject of these orders must be done to the same standards that are used in assessing court cases under the current system. As I am sure noble Lords will know as we discussed this when the 2008 Bill was going through, at the moment the commission has powers to go to the court. My clear understanding was that very special care would rightly be taken before any case was taken to the court by the commission. I would not like to think that just because we were slipping into an administrative route rather than a judicial route the standards would be any less rigorous in terms of getting the evidence, presenting it clearly and making sure that the case against the non-resident parent was just and merited the use of these powers.
	I would also like to think that very clear guidance will be given to staff. The impact assessment tells us that 11 staff will be given three days' training. I am a bit concerned about that. If they start to handle 500 cases a month, as the impact assessment statement tells us, I am not certain that they will have the capacity to be able to do that safely. I hope that the Minister, on behalf of the House, will satisfy himself that the guidance and training that these staff will get is fit for the purpose for which it is being given.
	I also note an increasing use by CMEC of ordinary bailiffs rather than court bailiffs, which concerns me. There are some safeguards in using bailiffs who are part and parcel of magistrates' courts and the sheriff court system in Scotland. Just using a centralised system of bailiffs means that the same care in how some of these orders are prosecuted might not be guaranteed.
	Perhaps the Minister would prefer to write to me on this judicial point. I understand that, under the Court of Appeal case of Rowley v the Secretary of State for the Department for Work and Pensions, there is no right of compensation for an action when an administrative procedure of this kind is used as opposed to any other kind of procedure. It would be helpful if the noble Lord, Lord Taylor, anyone else who is interested in this debate and I could be reassured about that important point.
	There is also a feeling that the recovery process is mechanical—that it is a steamroller operating automatically. Once the initial series of appeals, reviews and the rest of it are over and it is in the statutory recovery process, there is no avenue for anyone to consider again whether the amount of debt due or the liability is right or whether the assessments have been conducted properly. I have some concerns about that. Noble Lords will know that there is now a welcome introduction to things like the so-called options service, which sometimes give the possibility of a face-to-face interview. More than anything else, people who are subject to this statutory machine for recovery of debt feel that they do not have a chance for someone to listen to their case. I notice that DWP report 503 on relationships, separation and divorce, by NatCen and co-authored by Professor Nick Wikeley and others, found the pursuit of debt to be a remote processing system. If we are using this new administrative heavyweight machinery and there is some evidence that there is a remoteness in the processing system, there is a potential flaw that some people could fall through some of the systems and get hurt in a way that is disproportionate to the liabilities that they were allowed to owe.
	Accuracy continues to concern me about the whole operation of the CMEC proposal. Will the Minister ask the department to get the commission to explain how the accuracy figures are supposed to work? I have studied them for some time. The latest figures, for March 2009, show that on the basis of the "right to the nearest penny" test—I do not understand how that test is conceived and put together—84 per cent of the current system was right to the nearest penny, as was 91 per cent of the old system. That does not equate or relate to the evidence on the ground of people saying that their assessments are inaccurate. On the so-called "cash value" accuracy test in the March 2009 figures, 96 per cent of the current system is said to be accurate in terms of its cash value and 98 per cent of the old system is supposed to be accurate. These data are impossible to fathom. I can make no sense of them because they are meaningless. The Minister is careful about these things. Perhaps he will go back and try to make sense of these figures. A letter to explain what is going on to me and, possibly, the noble Lord, Lord Taylor, would be very welcome.
	As far as I can see, the last CSA standards report was published in 2003-04. It said that 65 per cent of liability orders were wrong. That was some time ago and I know that there have been improvements, but 65 per cent of liabilities being inaccurate is not a strong base on which to start using administrative powers of this kind. I think that the Minister will continue to take an interest in accuracy.
	I think that just short of £4 billion of debt is still to be collected; we will not know until the commission's next annual report is published. It would be helpful if the Minister could say when that is likely to be. In the past, annual reports of the commission and the CSA have slipped by sometimes for not weeks but months. I just hope that we will get the annual report in July as expected. Only then will we be able to discover what the trends and the outstanding debts are. Knowing when the annual report is to be published would be useful information which might reassure some of us.
	In addition to that, the commission has commissioned two reports from PricewaterhouseCoopers. One report is on the age of outstanding debt and the other is about collectivity of the debt. I hope that by now they have been received by the commission. If they have, I trust that they will be published. I hope that the Minister will insist that they are published so that we can all look at the exact trends in relation to the debt.
	Finally, the Minister said something about the appeal process which caused a question mark to appear in my mind. I understand perfectly that the Explanatory Memorandum says that there will be an appeal process, which is welcome so far as it goes. Perhaps the Minister will confirm that the appeal process is only about the correctness or otherwise of the laying of the order to the deposit taker. I do not think that it is about the merits of the liable debt. If an appeal is lodged within the 21-day period, can the non-resident parent then say, "Well, I am appealing not because the order has been laid incorrectly to the wrong bank, for the wrong reason or for the wrong amount, but because I cannot afford to pay this because it will affect my second family"? Does the appeal process stretch to a non-resident parent being able to appear in court and say, "Well, actually I do owe X thousand pounds, but for the following 16 reasons I can only afford to pay it back at a reduced rate other than that in the draft order which has been served on me"? If that is true, it would obviously encourage a great many non-resident parents to avail themselves of that appeal. Allegedly, in many cases, some of them have been trying to establish that for a long time.
	I know that I have given quite a list of concerns, but I finish by saying that I support the view of the noble Lord, Lord Taylor, and that these orders are required. I hope that they will be used carefully and as a last resort. I hope that they achieve the £2.1 million that they are set to try to recover for children. That is an ambitious target and I will be very surprised if it is reached. But in a year's time, come 2010, whenever the commission reviews the success or otherwise of these orders, the noble Lord, Lord Taylor, and I, and no doubt other Members of the House, will want to continue to have this discussion to make sure that the orders are being used efficiently and successfully, and to the benefit of the children who, ultimately, are those we are most concerned about.

Lord McKenzie of Luton: My Lords, I thank the noble Lords, Lord Taylor of Holbeach and Lord Kirkwood, for their contributions and for their support for this order, although they were not without some questions and reservations. That was the tenor of the debate. Perhaps I may start with the point made by the noble Lord, Lord Taylor, about the number of children who have been supported by the current system, which was the thrust of his question. It is estimated that around 250,000 of the current caseload are not compliant, but looking at the performance over the years and the number of children who are benefiting, as of March 2008, we see that some 749,000 children have benefited from the CSA's efforts.
	Going back to March 2005, the figure was 561,000. Thus the numbers have risen from 561,000 to 623,000 to 740,000 at March 2008, and to a provisional figure based on internal calculations about the impact, post the removal of Section 6 compulsion, of 810,000 at March 2009.

Lord Taylor of Holbeach: My Lords, I thank the Minister for giving way. I shall try not to interrupt too frequently, but I asked how many children are not receiving any money at all rather than how many are actually doing so. That presents a different side of the equation. If the figures are not to hand, I am quite happy for the Minister to write to me.

Lord McKenzie of Luton: My Lords, I am happy to write to the noble Lord in as much detail as I can, but I should stress that some 250,000 of the current caseload are non-compliant—that is, where money is not moving—but they are just the caseload in the statutory system, not those outside it. Some may have been outside the statutory system for a long period while others may be newly outside it once the Section 6 compulsion has been removed. In terms of the amount of maintenance collected, in the period to March 2009 it was £1.1 billion, up from £798 million in March 2005, so more money is flowing.
	Both noble Lords referred to the nature of the accounts we are seeking to reach with these orders. The noble Lord, Lord Taylor, said that if they will not facilitate access to joint or third party accounts, that is an obvious loophole, and indeed the same point was made by the noble Lord, Lord Kirkwood. I remember the debates we had on this when we considered the Bill last year. As I said when presenting the order, we are focusing on the accounts that we have identified because we believe they are the most fruitful ones from which to garner resources for children, but if our review shows that the potential loophole is being exploited, obviously we have primary powers to address it, and we would do that. The noble Lord, Lord Kirkwood, made the point that this is really about self-employed people, and he is absolutely right that deductions from earnings orders almost by definition cannot apply if someone does not have earnings in terms of a salary or a wage.
	The noble Lord, Lord Taylor, asked about the administration fee. It is set down in regulations and is the sum that will be levied by the deposit-takers for providing their services. Both noble Lords raised issues around the review. If that review leads to the need for further legislation, clearly there will be a consultation exercise and, quite properly, there will be debates in Parliament, particularly when regulations are brought forward. In terms of publishing the impact of that, I am sure that there will be one means or another by which that can happen. Noble Lords are thoroughly adept at securing debates on these issues whether there is a formal Motion before the House or not, and it is important that such debates should take place.
	The noble Lord, Lord Kirkwood, referred to the training that was identified in the documentation. I should stress that at the start we are approaching this in a fairly low-key way to make sure that it works properly. I think that a figure of 140 cases per month was mentioned in the impact assessment, but the commission has developed specialist training in conjunction with officials with expertise in the policy. They developed the process with the bank section and detailed guidance is already available to deposit-takers.

Lord Kirkwood of Kirkhope: My Lords, I do not want to interrupt the Minister either, but I think that the figure is 500 cases a month. I think that eventually 140 cases, steady state, might be successful. My reading of the impact statement is that up to 500 cases are being traded, which is different from 140.

Lord McKenzie of Luton: I shall go back to the impact assessment, but I thought that the figure of £2 million was reached by working with 140 cases, which means 1,680 a year at an average of £1,300. That is what drives the sum of £2 million. However, I shall see if further detail on the point is made available by the time I finish my contribution.
	The noble Lord, Lord Kirkwood, also said he thought that the commission was not being heavy-handed in its collection processes and that the deduction orders would be a kind of last resort. They will not be in all cases. As I said, we would seek to go down this path only if other mechanisms for trying to encourage non-resident parents to pay proved to be unsuccessful. The arrangements that are currently available to the original Child Support Agency and now the commission comprise deduction from earnings orders, liability orders, bailiffs, third-party debt orders, charges on property, orders for the sale of property, driving licence disqualification and imprisonment. Indeed, in the 12 months to the end of January 2009, a total of 120,970 enforcement actions were carried out. The most recent enforcement figure includes 30 non-resident parents receiving prison sentences, 510 receiving suspended prison sentences, 30 non-resident parents receiving suspended driving licence disqualifications and five being disqualified from driving. We do not apologise for that because it is right that the commission should be tough on those who simply refuse to pay. Indeed, we will have a debate tomorrow during our consideration of the Welfare Reform Bill on further measures set out in that legislation so that we are able to reach those people who will do everything they possibly can to avoid meeting their obligations to their children. It is shocking that this needs to be done, but it is only right that we pursue it. Reverting to the discussion we have just had, I am advised that the noble Lord is right. Some 500 cases per month are dealt with and 140 cases end in deduction, which I believe is the point he sought to press.
	On the appeal process, an appeal against the calculation may be made to a tribunal. The grounds for appeal against a lump sum deduction order show that the regulations do not actually restrict the grounds for appeal. For example, an appeal may be made where it appears that the amount set out in the lump sum deduction order is wrong or the liable person considers that a reasonable arrangement to pay has been reached. An appeal may also be made to follow on the commission's refusal to consent to release frozen funds. However, the circumstances where the commission may give such consent are set out in the regulations and therefore it is implicit that a court would consider a repeal against the commission's refusal to release funds only if it related to any of those circumstances.
	On the grounds for appeal against a regular deduction order, the regulations again do not restrict these grounds. For example, an appeal may be made that the amount of the regular deduction order is wrong or the liable person considers that a reasonable arrangement has been made to pay the arrears again, and it may also be made against any decision following an application for a review of a regular deduction order. In these circumstances it is implicit that the court would consider the appeal only if it related to the circumstances in which an application review can be made as set out in the regulations.
	The noble Lord, Lord Kirkwood, sought an assurance that these powers will be used proportionately. Deduction orders will be used only where there are arrears of child maintenance. As I said earlier, the commission will provide the non-resident parent with every opportunity to pay before a deduction order is considered, and there is the right to seek a review. The noble Lord asked for an update on the figures for the age and collection of debt, and I am certainly happy to write to him to ensure that he gets the most recent data we have. He also referred to issues around accuracy. That has been a long-standing challenge for the commission, but the data show that there has been continuing improvement, and certainly the operational improvement plan made a significant step change to the operation of the then agency and now the commission.
	The noble Lord, Lord Kirkwood, asked about the Rowley case. I shall get an update on that and make sure that he receives it. He referred to child maintenance and options. That is what we used to refer to as the information and support service when we were debating the Bill. The thrust of that service is to support particularly those parents who were forced to use the statutory system because that is what the legislation required, and to encourage people, again as we debated in the Bill, to seek to make their own arrangements outside the statutory system. It is really focused on that.
	I have some data about the extent to which the option service has been used. Since the repeal of Section 6 of the Child Support Act, which, as I said, previously compelled people on benefits to use the Child Support Agency, approximately 260,000 parents with a child maintenance interest have made benefit claims through Jobcentre Plus. All these have been offered support from child maintenance options, with approximately 110,000 accepting the support and 150,000 choosing to decline it. The proportion choosing to accept a referral to options has risen since the launch of the service and currently around 50 per cent of the offers are being accepted. I hope that gives the noble Lord a measure of where we are on that service.
	I hope I have answered the points that each noble Lord was pressing; I am happy to come back if they think I have not. I have committed to write to noble Lords on a couple of points and I am happy to do that. However, if there is nothing further, I commend the regulations to the House.
	Motion agreed.

Financial Assistance Scheme (Miscellaneous Provisions) Regulations 2009

Copy of the Regulation
	18th Report from the JCSI

Motion to Approve

Moved By Lord McKenzie of Luton
	That the draft regulations laid before the House on 16 June be approved.
	Relevant document: 18th Report from the Joint Committee on Statutory Instruments.

Lord McKenzie of Luton: My Lords, many noble Lords will be familiar with the Financial Assistance Scheme, which makes payments to people who have lost all or part of their occupational pension because their pension scheme began to wind up underfunded. In December 2007, we announced a significant extension to the FAS, key elements of which have already been implemented. During February and March this year, the Government consulted on a set of draft regulations that implement further elements of the 2007 announcement and make changes to the administration of the FAS. I now bring these draft regulations before the House.
	The draft regulations make a number of changes to both the structure of the assistance and the administration of the FAS. They will allow for the FAS to acknowledge where schemes had made provision to pay what used to be called an unmarried partner; that is, someone who while not married to the member—or now not in a civil partnership with them—was living with the member on the same basis. In order to qualify, the surviving partner must have been living with the deceased member before they died and be either nominated by the member or prove financial dependency or interdependency. Where the deceased member left both a spouse and a partner, the partner will be paid and not the spouse where, and only where, the member had nominated that partner.
	The draft regulations will also allow for payments to be made to certain children and young adults who were financially dependent on the deceased member. Such payments continue up to the age of 16 and may continue to age 23 where the child remains in education or cannot work full time due to a disability.
	On 1 January each year, assistance in payment, which relates to scheme rights accrued after April 1997, will be increased. That increase will be in line with the retail prices index up to a maximum of 2.5 per cent. If the retail prices index goes down or is at 0 per cent, there will be no increase applied for that year but the amount in payment will not be reduced.
	Assistance is payable from the qualifying member's normal retirement age. However, we are aware that some people may have accrued rights in their scheme to a different age—for instance, when a scheme changes its normal retirement age and someone is a member both before and after that date. These draft regulations will take this into account. Where their normal retirement age is after the date to which a part of their pension has accrued, that part of the expected pension will be actuarially uplifted. Where the normal retirement age falls before the date to which a part of their pension has accrued, that part of the expected pension will be actuarially reduced.
	Currently, assistance tops up the pension provided by the scheme to 90 per cent of the person's expected pension. The cap ensures that, where 90 per cent is higher than £26,000, assistance is limited so that the individual gets from the scheme and the FAS in total no more than that amount. These draft regulations will allow the £26,000 announced in March 2007 to increase annually in line with the retail prices index from April 2007, ensuring that the cap keeps pace with inflation. For anyone who was entitled to assistance from April 2007, the cap will be increased to £26,936. These are significant improvements in the structure of assistance payments and I hope that noble Lords will welcome them.
	I will now cover certain issues which we need to address in the context of delivering these changes but which were not part of the 2007 announcement. First, there are schemes that paid what is known as a bridging pension. The commonest example is where a man retires at age 60 with a scheme pension that goes down at age 65 when his state pension begins. Some schemes, when buying the annuity, have flattened this bridge, if I may put it in that way, so that the annuity pays out the same amount over the person's lifetime. However, we have been made aware that other schemes have bought annuities with the bridge intact. These regulations allow for assistance to mirror the annuity: where it has smoothed the reduction over the individual's lifetime, the assistance will do the same; where the annuity retains the bridge, the assistance will reduce when the annuity goes down.
	At present, the FAS takes no account of any increases in the scheme pension once assistance begins. When we decided to provide indexation on assistance, this oddity had to be corrected. Paying indexation in respect of the assistance only would mean those with a flat-rate pension getting less of an increase in total than someone whose scheme paid nothing. Therefore, the amount of pension brought to account in the assistance calculation will be the amount actually in payment, and any subsequent increase in the pension will also be brought to account.
	The issue of taking account of payments made before the final entitlement is calculated also needs to be addressed. It can take a scheme some time to decide what it can pay a member from its remaining assets; until then, the scheme and the FAS can make payments on account of entitlement. Because the scheme normally pays an amount that it is reasonably sure is lower than the final amount, assistance may have been overpaid before the correct amount has been established. These regulations allow scheme payments to be brought to account when the final rate of assistance is being calculated. This means that, over the individual's lifetime, the correct level of payments will be made.
	The changes that I have described will apply in relation to a person's entire period of entitlement to FAS payments. Many individuals already being paid now will find that their entitlement increases and, where this happens, they will be given payments for past periods. However, the way in which the various changes interact means that it is possible that in some cases entitlement goes down. Where this occurs and someone's finalised entitlement had previously been determined, the current amount will remain in payment. This protection will also apply where a person's initial payments have previously been protected. However, these arrangements will not apply to any other initial payment calculations. Secondly, protection will, in some cases, exist only for a limited period. In some cases, standard entitlement could go up—for instance, because of indexation—and this could result in that entitlement becoming higher than the protected amount. Where that happens, the higher amount will be paid.
	These changes will require the FAS to collect different information, and these regulations make the necessary changes to the information regulations. They also make changes to the review and appeal regulations to allow for decisions to be challenged in these areas. Trustees will also be required to supply more details about the scheme and its expenditure—for example, information on current or contemplated legal proceedings—and to notify the FAS of any contemplated significant changes in the investment of the scheme's assets.
	I come now to operational changes. At present the FAS is administered—very well, I suggest—by DWP staff. However, the FAS will be undertaking broadly similar functions to those currently undertaken by the board of the Pension Protection Fund. It therefore seemed appropriate to have both systems managed by the PPF. These draft regulations confer the responsibility of managing the FAS on to the board of the PPF. Current FAS staff will be seconded for a temporary period to the board to provide continuity. The Government will continue to fully fund the FAS, none of whose costs will fall on the PPF levy payer.
	This change requires certain other changes. These will allow the DWP to pay the board for its FAS-related work, allow the board to delegate its FAS work to its own staff and some of its work to a commercial provider, and give these people access to relevant DWP information. In addition, the board will have discretion to make payments to schemes in certain circumstances—for instance, where the scheme has run out of money and is unable to complete wind-up. The draft regulations also make certain minor changes that the experience of the FAS staff has shown would be helpful, such as allowing payments for periods other than monthly.
	I shall revert to one matter that I have mentioned: I said that the payment for surviving children and young adults would be paid until age 16 unless the child had a disability or was in education. In fact, payments are made up to age 18 unless the child has a disability or is in education, in which case payment can continue until the age of 23.
	Noble Lords have been very patient with me during what has been quite a technical explanation. The changes in the draft regulations offer significant improvements for many FAS members. In my view, these draft regulations are compatible with the European Convention on Human Rights and I commend them to the House.

Lord Taylor of Holbeach: My Lords, I declare an interest as chairman of the Conservative and Unionist Party Agents' Superannuation Fund. I thank the Minister for introducing these regulations and for the detail in which he has explained the complexities of much of what is involved.
	The consultation process earlier this year on these regulations was interesting. I understand that there were 148 respondents on the DWP website. Many individuals did not respond to the specific proposals but instead expressed their disagreement with the content of the Government's announcement of December 2007. Does the Minister feel that the Government have done enough to adequately explain the proposal to those affected?
	Of course, the Minister will be only too aware that the December 2007 announcement was consequent on the Young review, which was set up as a direct consequence of the Government sinking our lifeboat proposals in another place. The scheme at the time was bogged down and potential beneficiaries were denied access to those pensions to which they believed themselves entitled. The Minister will be aware that some died before receiving any money.
	We note that these regulations bring into effect what we hope will be the last phase in the changes to the management of the scheme, making the board of the Pension Protection Fund the scheme manager. I note the arrangements for the transition for the FAS as described by the Minister.
	We have repeatedly told the Government that they have failed properly to address the pension time bomb. The danger is of two-tier pension provision with unfunded public sector pensions paid for by taxpayers in the private sector, whose pensions face a continuing underfunding crisis. These regulations are hardly a brick in the wall of "Building Britain's Future". It is a future that looks increasingly bleak for many until we have a Government who can come clean about public finances and tell the truth about government spending plans.
	From the moment of Gordon Brown's first Budget, removing £5 billion a year in advance corporation tax, amounting to some £150 billion in total removed from private sector pension funds, he has mismanaged the pensions issue and let people down. If these regulations make some recompense, they are to be welcomed. Can the Minister give that assurance?

Lord Kirkwood of Kirkhope: My Lords, I am happy to follow the noble Lord, Lord Taylor, again. I welcome these regulations. The Minister is right to be careful in the way in which he explains the changes from the Dispatch Box; although the regulations are technical, they have a dramatic effect on some of the pensions to which they relate.
	The scheme that the Government laid out in December 2007 has been improved and these regulations improve it further, which is welcome. The consultation referred to by the noble Lord, Lord Taylor, was interesting, though; most people ended up by simply complaining that the Government had not gone far enough fast enough. Maybe that is why the consultation lasted only for six weeks, not 12; maybe the Government just thought that they would get another dose of the same if they continued the consultation for the usual period.
	I hope that the upcoming so-called "winter package" regulations that remain to complete this December 2007 reform will have a proper consultation attached to them and that it will take 12 weeks. One of the things that should be canvassed in the course of that consultation period is the extent to which the Government may in future be prepared to look again at the generosity or otherwise of the totality of the scheme. It is obviously an improvement and it is welcome so far as it goes, but only when the Government take the transfer assets into their control will they be able to get a proper handle on exactly what the fund has available to it. At that point, they could consider the possibility of doing even better. Although the scheme is welcome and generous so far as it goes, it does not deal with the issue to the extent that some of the people who are affected by these defaults and company collapses would like to see. We must keep that point of view at the front of our mind in considering these regulations.
	I would like to mention two other operational matters. There is some concern that, if the board of the Pension Protection Fund is managing these provisions, there needs to be a clear separation of responsibilities, particularly in relation to costs. I hope that the Minister will keep an eye on that. I think that this potential concern is understood, but I hope that it will be at the forefront of his mind as these matters are taken forward.
	I also concur with the view expressed in the consultation that targets need to be agreed when the Pension Protection Fund board runs this scheme in terms of the time taken for payment. Targets to avoid undue delays are important and I encourage the Minister and the department, in introducing these regulations, to make sure that undue delay is avoided if at all possible.
	In welcoming these regulations and the December 2007 package, I still think that it is open to the Government to keep the potential long-term generosity of this package under review, with the hope that, if the opportunity arises, it could be improved on even further in future.

Lord McKenzie of Luton: My Lords, I again thank both noble Lords who have spoken and supported these regulations. Let me start with the point made by the noble Lord, Lord Kirkwood, about keeping the door open to changing or improving the settlement that was reached. The Government made it clear in 2007 that we considered that the revised scheme represented a generous and appropriate final settlement. We are satisfied that we are complying with our EU obligations in that regard. The net present value of the schemes taking account of these regulations is something like £3.5 billion—a not insignificant cost. The scheme is estimated to help and provide assistance to something like 140,000 individuals. As at 22 June, it had already paid some £64 million to some 12,000 members. A lot of work is going on; this is a very significant scheme. When the Government have completed it—there is one more set of regulations to come—we will actually have done more than we committed to doing in December 2007, particularly with regard to severe ill health.
	I say to the noble Lord, Lord Taylor, that of course there are people who are not satisfied with this. One can understand it—they lost the expectation of a full pension and did not get it replicated in every detail. I acknowledge that that is concerning for them, but there has to be a balance. We never said that FAS or indeed PPF arrangements would replicate what individual schemes would otherwise have provided.
	The noble Lord, Lord Taylor, gave us a mini-version of the Conservative tirade about pensioner apartheid. Let me be very clear: anybody who has analysed the evidence will see what is happening to defined benefit schemes and what has happened to pension provision in recent years. We know that longevity is increasing. For a long time, actuaries did not wake up sufficiently to what was happening to returns on asset values; they were overstated and it was assumed that they would remain that way for a long time. The noble Lord's Government's legislation on pensions in a sense forced pension holidays because it limited the extent of surpluses that could be left in funds. The repayable tax credit was part of a restructuring of the corporation tax system which was accompanied by a reduction in the rate of corporation tax. It was to do with moving further from an imputation system of corporation tax to, I suppose, a more classical system. That is what drove those changes.
	Between 1979 and 1997, because of the interaction of the tax credit arrangements with the basic rate of income tax, the Conservative Government progressively reduced the value of that tax credit to pension schemes. I have forgotten the percentage, but it was something like 18 per cent over that period.

Lord Taylor of Holbeach: My Lords, I have no doubt that the Minister will acknowledge that, if you reduce tax, you will inevitably reduce the value of the tax credit.

Lord McKenzie of Luton: My Lords, that was to do with changes to the rate of income tax. Our adjustment was accompanied by changes in the rate of corporation tax that enabled and encouraged companies to continue to invest in their businesses so that, as their businesses grew, they could pay bigger dividends in the future.
	In the three years immediately following that change, the value of pension schemes rocketed. What effectively did the damage was the dotcom collapse and what that did to equity values, not only in the UK but around the world. So we reject the contention that there was a raid, in the noble Lord's terms, on pension schemes. That is not a fair analysis of what took place.
	On public sector pensions, I understand that the noble Lord's leader has proposals to produce a double whammy, with defined contributions in public sector schemes at the same time as having a "pay as you go" basis for existing pensions. Is that right? If so, it would be a very interesting development and, I suspect, a very costly one.
	There have been amendments and changes to public sector pensions. The normal retirement age has been changed for new entrants and there have been changes to cost capping and cost sharing. The long-term financial projection over 50 or 60 years shows that those pensions remain affordable, going from around 1.5 per cent at the moment to up to 2 per cent of GDP. So, again, I reject the noble Lord's assertions on that. However, I know that that is straying somewhat, as indeed did the noble Lord, from the regulations, which, despite some areas of disagreement, seem to be supported.
	Motion agreed.

Policing and Crime Bill
	 — 
	Committee (2nd Day) (Continued)

Amendment 66
	 Moved by Baroness Miller of Chilthorne Domer
	66: Clause 15, page 17, line 3, leave out "period of three months" and insert "one week"

Baroness Miller of Chilthorne Domer: The Government made one positive move in the other place, when they removed the term "common prostitute" from the Street Offences Act 1959 as amended by Clause 15. I think that that was generally welcomed. However, what the Government have given with one hand, they have rather taken away with the other, because upping the incidence of persistence makes criminalisation more likely. Our amendment suggests that "persistent", if it needs to be defined at all, should be defined only as conduct which takes place on two or more occasions within any three-month period. As "persistent" is defined in the Bill at the moment, someone could be charged within a short period of a day, several days or over a week, and up to a three-month period.
	While the Bill creates a three-month deadline after which the person would have to be seen again by police officers soliciting on two or more occasions, it does not provide a meaningful deceleration of the criminal process in the context of work patterns of the majority of people involved in street sex work. Working patterns vary—we have heard in debate today of the wide variety of people involved in prostitution—yet the reality for the majority of women involved in street sex work is that the factors that lead to their entry into and continued involvement in it mean that most have to solicit regularly, often every day, hence most could still become very easily and quickly caught up in the criminal justice system under the proposed change.
	As the Minister will know, we have argued for progressive decriminalisation. We feel that this change goes in the opposite direction. There is also a danger that such legislation could encourage intensive, short-term policing operations which criminalised large numbers of women.
	Unsurprisingly, the Government's proposition has no support from the Safety First Coalition, which believes that it would be a step in the wrong direction. Given that the Government's declared intention is that the Bill should make life safer for women, I am sure that they would not want to take a step that made it more criminal and less safe. I beg to move.

Viscount Bridgeman: I have some sympathy with the amendment. I find it deeply frustrating that the Government continue to tinker with existing legislation on prostitution rather than engage in a thorough review of the enormous number of Acts and offences around the subject. Although I support the Government's rather weak attempts to remove some of the stigma from those seeking to find a way out of prostitution by removing the term "a common prostitute", it is not nearly enough. The stigma of a name, while it is often an obstacle to getting a job, is only one small part of the problem. The very existence of a criminal record is a much more significant obstacle, as are the circumstances that led to prostitution in the first place.

Baroness Morris of Bolton: I support the thoughts behind the noble Baroness's amendment, and what my noble friend Lord Bridgeman said. The biggest barrier to women getting out of prostitution is their criminal record. They are stuck somewhere they do not want to be. Eighty per cent of income from street workers goes to pay their fines, so I do not see how this is in any way going to help women to get out of prostitution or make them any safer.

Baroness Howe of Idlicote: I also support the amendment. It makes perfect sense, really. To talk of conduct being persistent if it takes place on two or more occasions in a period of three months is clearly absurd. That is not persistent. If you replace that period of three months with one week, there is a certain logic to it. Although one might not want it to be there at all, as it were, I certainly support the amendment.

Lord Brett: Amendment 66 seeks to amend aspects of Clause 15, notably the definition of persistence which this clause would introduce to the offence of loitering and soliciting for the purposes of prostitution under the Street Offences Act 1959.
	Clause 15 would amend the offence of loitering or soliciting for the purposes of prostitution found in Section 1 of the Street Offences Act in removing the term "common prostitute". I appreciate the comments made by the noble Baroness, Lady Miller, but I believe that it is a step in the right direction. It inserts an explicit requirement to prove that a person has acted persistently. The effect of Amendment 66 would be that persistence, as several noble Lords have explained in this short debate, would be defined as two or more occasions in one week, rather than two or more occasions in three months. This would mean that people could be arrested for loitering and soliciting for the purposes of prostitution only if they were found to have done so on two or more occasions in one week. This would significantly narrow the definition that we are introducing.
	We have sought police advice in developing this amendment and believe that it sets the threshold for persistence at the appropriate level. Restricting the definition to cover only those found loitering and soliciting twice within one week would narrow this offence too much and would require greater police resources to collate the necessary evidence. This would limit the power of this offence, and responses we received to our consultation, Paying the Price, suggested there was support for maintaining the offence in order to tackle the problems associated with street prostitution.
	The definition of persistence as defined by Clause 15 strikes a balance which gives the police the power to take action against those who are engaged in street prostitution on a regular basis, while taking account of the fact that some may leave prostitution but return intermittently, having lapsed in their attempts to leave. Attempts to restrict this definition would affect this balance, and we believe that the definition that would result from the amendment is too narrow. On that basis, I ask her to withdraw her amendment.

Baroness Hanham: Can I ask a practical question? What are the chances of the same beat officers being around twice in three months to witness this offence taking place? To make this stick, presumably the same police officer will have to see the same person meet up with same prostitute more than once in three months. Our experience of beat officers is that, however good, they do not last as long as three months, or they are on night duty, or they are away. That may be fine—it may be that there is no persistence at all and they never get prosecuted at all, and some people would be very glad about that. If you made it twice in a week, there might be some chance of consistency with people passing them on the street.

Lord Brett: The noble Baroness makes an interesting point. I presume that it would depend on the beat patterns in different police forces in different parts of the country, from cities to rural areas. As she rightly says, it may have the result that, if beat officers are not there very often, they may not spot what would be persistent in their proposals in the amendment. The police practice is to issue cautions, and that will continue. If a prosecution is brought, the prosecutor is required to prove that the man or woman was loitering on at least two occasions. They can of course advance an explanation as to what they were doing. We see these changes that were signalled in the co-ordinated prostitution strategy as an important element to that approach. The noble Baroness's point is a good one, but, if anything, it would assist the noble Baroness, Lady Miller, to accept the position, if it meant in reality that there was no difference between twice in three months and twice in one week.

Baroness Miller of Chilthorne Domer: I am slightly confused by the Minister's comment. He mentioned at one point "maintaining" the position, whereas the Bill changes the current position. Far from maintaining it, it increases the chances of criminalisation. One of the things that worries me about this is that it will push women to work in places that are even further away from help and more underground, and where they are more vulnerable. It worries me that the Government are moving in the wrong direction. I can see that this evening the Minister is not likely to agree with me, but I should like him to dwell on whether this will make women safer. We all have in the back of our minds the women in Ipswich. If women are trying to avoid being seen by the police, which is what this would encourage, they will solicit in ever more dangerous areas. I see the Minister is slightly tempted to reply to me, so I will let him.

Lord Brett: I will certainly take on board and look at the question of safety. That is central to what we are seeking to achieve in the Bill. Perhaps I should be clearer in what I was intimating to the noble Baroness, Lady Hanham. It does not have to be the same beat officers, because they issue cautions. The caution will be the evidence of whether there has been a soliciting and loitering offence twice within two months, three months or whatever. As the noble Baroness rightly says, we are not making progress on this issue. The Government see this as a central part of what we seek to do. We do not want to jeopardise the safety of sex workers and prostitutes. The intention of our endeavours is to protect them within the law and to assist them to remove themselves from an industry where many of them are exploited.

Baroness Miller of Chilthorne Domer: I thank the Minister for his offer to look again at the issue of safety between now and Report. In the mean time I beg leave to withdraw the amendment.
	Amendment 66 withdrawn.
	Clause 15 agreed.
	Clause 16 : Orders requiring attendance at meetings
	Amendment 67
	 Moved by Viscount Bridgeman
	67: Clause 16, page 17, line 19, leave out "three" and insert "a course of"

Viscount Bridgeman: Amendments 67 and 68 seek to probe further the requirement to attend meetings. In particular, I hope the Minister can give us some detail about what these meetings will consist of. A considerable amount of research material has been published analysing the factors that lead a woman into prostitution and keep her there. These factors are diverse and frequently of a very serious nature, including alcohol and drug addiction or an abusive family life. Prostitution often leaves a woman with long-term problems to overcome if she tries to leave the industry, including serious long-term mental or physical health problems.
	It would not be easy for even a well resourced and leisurely rehabilitation system to accurately identify these factors, let alone start the long process to treat, cure and support the patient afterwards.
	The noble Baroness, Lady Miller, raises a sensible point with her amendment about the necessity of ensuring that those coming to the end of their courses are given the information necessary to access any support network available to them. I hope the Minister will be able to reassure the Committee that passing over such information will be a priority.
	However, perhaps I may ask the Minister whether he imagines that three compulsory meetings, possibly with an unwilling or disengaged patient, will really make a difference. How will the court decide which sort of meetings would be most relevant? Will there be any medical assessment or professional intervention to identify any health problems? Would such an assessment count as one of the three meetings necessary to meet the order's requirement? And of course, as with so many such initiatives, there will be a problem with resources. I understand that the Government are planning to rely on existing NGOs and charities to provide these meetings. Will they be reimbursed by the courts for their participation? If not, does the Minister not think that these rehabilitation orders could place an unfeasible burden on the third sector?
	I have many questions to ask about what level of scrutiny there will be over the quality of advice and support offered by these meetings. Will a government agency be made responsible for ensuring that the meetings are meaningful? What steps will be taken if the courts decide that the meetings were unproductive and badly targeted?
	The levels of support a woman often needs to lift herself out of prostitution and establish herself in a stable and healthy life afterwards are considerable. Although we welcome the introduction of a rehabilitation order as an indication that the Government are starting to accept that criminalising prostitutes just to throw them back on to the streets does nothing to address the problem in the long term, I am very sceptical that the requirement to attend three meetings of an uncertain and unspecified nature will prove to be much more helpful.
	As I said, these are probing amendments. However, I hope the Minister will be able to give us more background to the arrangements for this rehabilitation programme.

Baroness Miller of Chilthorne Domer: Our Amendment 68A is in this group. At this stage, before we debate clause stand part, I simply want to say that, in our view, the only sort of courses that women should be offered—"required" is too strong a word—are ones that will really help them to get out of prostitution. As the Minister will appreciate, that usually starts with improving their economic prospects. I tabled this amendment because what mostly stops these women improving their economic prospects is the fact that they may not be receiving any of the benefits to which they are entitled; the fact that they may not be aware of other employment opportunities and the training opportunities that go with them; and the fact that affordable childcare is one of the biggest reasons why many women find it difficult to take up other forms of employment. There are a number of women to whom none of those factors will apply, and, as we heard, some women will want to continue to work in the sex industry because it pays very well. Nevertheless, if the Government are serious about offering alternatives, they need to be very focused on exactly which courses are on offer. I shall leave the other main parts of my argument until the debate on clause stand part.

Baroness Morris of Bolton: I support these amendments tabled by my noble friend and by the noble Baronesses, Lady Miller. Given that most women go into prostitution because of poverty, debt, domestic violence, homelessness and drugs, can the Minister say how those will be addressed in the rehabilitation courses?

Lord Brett: These new orders will be available on conviction for loitering or soliciting for the purpose of prostitution as an alternative to a fine. They will assist the offenders to begin to address the reasons behind their involvement in prostitution and explore routes out. They will require offenders to attend three meetings with a supervisor in order to address the underlying causes of their involvement in prostitution.
	Amendment 67 would replace the requirement to attend three meetings with a requirement to attend "a course of" meetings which would, therefore, be less prescriptive than in the current clause. I am aware that there have been some concerns that three meetings will not be sufficient to address the underlying causes of prostitution. We have always accepted this point and acknowledge that the process of exiting prostitution may be gradual. The aim of the three meetings is to establish initial engagement with services offering routes out of prostitution and to help trigger continued involvement in that process.
	Given that the process of exiting prostitution is likely to be long in many cases, it is unlikely that one course in itself could address all the issues necessary, unless it was quite extensive. This would then make the prospect of a breach more likely and could risk setting people up to fail. We do not want to make the requirements of the orders too demanding because the offence is relatively minor and an order is the equivalent of a fine. In the light of the fact that this is a criminal penalty, it is important that there is some clarity about what the order would entail and consistency between different areas as regards the number of meetings that a person would be required to attend.
	Amendment 68 would remove the provision which sets out the purpose of the order, which is to assist the offender,
	"to ... address the causes of the conduct constituting the offence, and ... find ways to cease engaging in such conduct in the future".
	The fundamental aim of the order is to help those involved in street prostitution address the causes of their involvement and to help them to find ways to stop working as prostitutes. It is important that the legislation makes this clear to the court, and that supervisors are aware of the aim of the meetings which they will be conducting with the offender.
	Amendment 68A, which we have not debated in detail and has been tabled by the noble Baroness, Lady Miller of Chilthorne Domer, would add to the definition of the purpose of the order. The intention of the amendment is to ensure that advice about housing, benefits, employment and affordable childcare can be part of the order. Of course, we recognise that such issues may well be addressed as part of the order and could be vital in helping someone address the causes of their involvement in prostitution. We acknowledge that a number of significant and complex issues will need to be dealt with in order to help someone start to find a route out of prostitution. That, however, is why we do not believe that it would be appropriate to specify which issues need to be addressed on the face of the Bill.
	The needs of each person who is made the subject of an order will be different and complex. For this reason, it is preferable for the purposes of the order to be defined in broad terms and that specifying issues on which advice must be provided is overly prescriptive. In some cases, it may not be necessary to provide advice on childcare, for example. In other cases, there may be other issues on which advice is necessary but which are not specified in the Bill. In such cases, there is a risk that these could be neglected or not prioritised appropriately because of the need to meet the requirements of providing advice on the matters specified in statute.
	Leaving prostitution will often be a gradual process, and the process of completing an order will be just the first step for many. It will be necessary for the supervisor to recognise the multiple needs of someone who is made subject to an order and to prioritise these to achieve progress. There is a risk, however, that requiring in statute the provision of advice on a range of matters in a relatively short space of time could be counterproductive and could risk overwhelming the subject of an order with a number of issues and problems that they may need to address, perhaps in a more considered and leisurely form.
	I understand why the noble Baroness has tabled this amendment and we appreciate her concerns. We do not believe, however, that her amendment is necessary. Instead, we consider that the issues she raises would be more appropriately addressed in guidance rather than on the face of the Bill. I can assure her that we will deal with these issues in guidance and I hope that for the reasons I have set out, she is persuaded that that approach is preferable.
	While recognising the need for flexibility, it is important to retain a clear structure to the orders in terms of the number of meetings, the purpose of the order and the criteria for appointing a supervisor. We believe that such requirements are important and will help to ensure that the orders are delivered more effectively.
	I hope that a number of the points raised by the noble Viscount were covered in my response; if not, I shall happily seek to provide additional information outside the Committee. A question was asked regarding health concerns. Because there will be almost a bespoke service to the individual, which may include drug counselling and health monitoring, a number of issues will probably be raised at the first meeting.
	No government agency as such will be responsible for monitoring orders. A supervisor will be appointed by, and be accountable to, the court. Of course, the supervisor will be appropriately appointed for the needs of the person on whom an order has been imposed. We will evaluate the general success of the orders once a sufficient number of cases have been brought and completed, but this endeavour is a genuine attempt to persuade people to start the route out of prostitution.

Baroness Howe of Idlicote: I thank the noble Lord for giving way. I had intended to intervene a little earlier but the Minister had already risen to his feet. I still find this a little confusing. It is set out in the Bill that an order is made and a supervisor is appointed and so on, but is that the end of it? As I understand it, the offender can listen to what is advised and to all the things that she needs to take account of, and that is it, and a similar order or any other order may not be made on that "offence". Is that correct?

Lord Brett: It is, unfortunately, a truth that we hope not to experience too often. If an individual simply sees the order as an alternative to a fine, she will sit through three meetings, which have to take place within six months, without taking any regard of what is said. The situation is not much different from that of people who receive speeding fines. If you get caught for speeding, you are now offered the alternative of attending a half-day course on the dangers of speeding and on how to avoid speeding. In a sense, the intention is to rehabilitate the person guilty of the offence of speeding. Someone can go on that course and sit through it all day without taking any notice. They can then get in their car, drive at an excessive speed on the way home and perhaps get caught again. With this measure, we are hoping to bring out from prostitution people who are prepared to accept and take advantage of the help that is available, which would go beyond the three meetings. It is hoped that support for their problems would then be given within the supervisor's organisation and beyond. I hope that that answer offers some encouragement to the noble Baronesses, Lady Hanham and Lady Miller, and that the amendment will be withdrawn.

Baroness Hanham: Perhaps I may try to get my mind around this. This is not a probation order; it is an alternative to a fine. Therefore, will the defendant be told that either they will be fined or that alternatively they can choose to attend rehabilitation meetings? Will there be a choice? Are the magistrates going to tell them that they can choose one or the other? Either way, it will still be a court decision, which of course will be subject to a breach, and the breach will result in whatever the court would have done. It is important to know whether the decision is an alternative for the Bench or for the defendant. The noble Lord is right: if you are charged with drink driving, you will get time off if you decide to attend a course. However, if you breach that, it will constitute another offence. There will be a bit more to unpick on this issue, so it would be helpful for the rest of our discussion to have clarification on whether that is the situation.
	My noble friend asked who was going to run these meetings. It will not be the supervisor—that will come later—but will they be run by the probation service or by organisations that are geared up to deal with advice? Who is involved in all this?

Lord Brett: The noble Baroness asks two apposite questions. The answer is that it will be for the court to decide and therefore there will be no voluntary principle. The court will presumably make the decision on the basis that an order is more appropriate than a fine. As was said earlier, we are relying on the organisations that are already working in this area. In some areas, this is already happening on a voluntary basis without court intervention, and we see that as a way of taking this measure forward. We do not believe that the resource requirement will be that significant, but if it is, those providing the supervision, and so on, will be the first to tell us about it.

Lord Ramsbotham: What resources will the courts have available to decide? What resources can they call upon?

Lord Brett: In taking the decision to apply an order in preference to a fine, the courts will not need additional resources because the supervision will be discussed with those organisations already involved in assisting people in prostitution. The court can consider anyone to be appropriate and capable of carrying out that role, and the guidance will state clearly the skills that are required. Those people will all be working with specialist projects. We have identified the voluntary sector to do this because it has the greatest experience. If we are trying to persuade people to give up prostitution, it is perhaps better to do that than through the more traditional law and order method. I hope that that answers the noble Lord's question.

Viscount Bridgeman: I am grateful to noble Lords who have spoken to this amendment. It is clearly a very involved subject, and my noble friend Lady Hanham has raised one or two points. I noted a reference in the Minister's speech to it appearing on the face of the Bill. We shall carefully analyse the speech in Hansard. In particular, we will want to know how much of the arrangements for the rehabilitation of prostitutes will appear as orders to the Bill. In the mean time I beg leave to withdraw the amendment.
	Amendment 67 withdrawn.
	Amendment 68
	 Moved by Viscount Bridgeman
	68: Clause 16, page 17, leave out lines 22 to 25

Viscount Bridgeman: Following the last debate, I turn to the question of the "suitable person". Just as the Bill is largely silent on the details of the meetings, so too is it lacking in any detail on the qualifications, training or experience expected of that person. The role will be critical if the meetings are to have any effect at all. The person will not only have the responsibility to identify what meetings the defendant should attend, but will represent the best opportunity for a prostitute to develop a relationship with a network of bodies and organisations to help her out of prostitution. What scrutiny will be put in place to ensure that the suitable persons are competent? The Bill allows for a new person to be appointed if the first is unable to continue. What will be the grounds for this change? Can the prostitute request a different person?
	I am also uncertain about how the person will reconcile the two aspects of his or her responsibilities. He or she will, on one hand, be expected to support the prostitute, and on the other will be expected to report any breach of the order back to the courts, knowing full well that such a report may result in a fine or worse. How can such a dual role be maintained? Does the Minister expect that suitable person, who no doubt has worked hard for many years to support these women, to be able to send them back to receive a criminal penalty? I beg to move.

Lord Brett: I thank the noble Viscount for his apposite questions, starting with what a supervisor is, and why we have not specified it more clearly in the Bill. The supervisor will normally be based in a dedicated support project for those involved in prostitution where such a process exists in a local area. However, it is not the intention that the role of the supervisor should be defined so as to limit the project work of a dedicated support user in practice. Supervisors may be based in a women's resource centre or drug rehabilitation organisation. We want to tailor the supervision to the needs of the person who will benefit from the order.
	That flexibility increases the potential availability of the order and means that an appropriate supervisor can be identified to deliver the order in cases involving male prostitutes, transgender prostitutes or young people involved in prostitution. All the clause requires is that a supervisor appears to the court to have the appropriate qualifications or experience for helping the offender to make the best use of the meetings, to address the causes of their offending and ways to stop it.
	The intention is that the court can use anyone whom it considers appropriate to carry out that role. Guidance will state clearly those who have the greatest skills. They are likely to be people already working in specialist projects. We see a lot of advantages in using existing project workers to act as supervisors, not least that they may be in continuing contact with an individual after the three meetings have ceased. The voluntary sector is identified to deliver that because it has the greatest expertise in dealing with those involved in prostitution, and all those organisations have a key-worker approach, which will be extremely important in supporting individuals with a difficult challenge. A constable or the offender can apply for the supervisor to be changed if they consider the supervisor unable to continue to act. It will ultimately be for the court to judge whether that is the case and whether to amend the order. Equally, if people move from one area to another, adjustments can be made. The idea is to be as flexible and supportive as we can. The requirement for three meetings is but a start, and we hope that many will be encouraged from the first and second meeting to continue beyond the third.

Baroness Stern: I probably missed something that has already been said, but can the Minister explain who pays the supervisor?

Lord Brett: The supervisor is someone already working in the voluntary sector in a special project. I am not absolutely clear what the costs would be and how they would be accounted for. I will investigate and write to the noble Baroness on that precise point.

Baroness Miller of Chilthorne Domer: The Home Office assessment is that £180,000 a year will be allocated for this, which, if you assume that 1,000 women will be referred in a year, is only £180 per woman, which with on-costs for someone with three meetings, I suggest will result in a considerable shortfall. The costings alone call that into question. The noble Baroness, Lady Stern, raised the issue. Referral orders have been supported by some projects working with women, but they are in a dilemma. They support the idea of referral orders, but they are going to be on the receiving end of the money, which may make them less objective.

Lord Brett: I have to say that the last opinion of the noble Baroness does not conform to my experience of people who work in the voluntary sector. Many of them, as we know, do dedicated work on salaries and income levels that many of us would find ourselves not attracted to.
	We have to make an estimate; we cannot be sure that the number of orders will be as forecast, or that the number of recipients taking out more than the minimum of three meetings will be as such. Clearly, the matter will have to be reviewed. As I have said, it will be reviewed as the programme comes on stream, the orders are made, and the people subject to orders have their meetings and go on to further support.

Baroness Hanham: The order will be for three meetings. That will be for the court. At the end of those three meetings, that is the end of the court's involvement. Is it then up to the organisation and the woman concerned to decide whether to continue that, so that that will be a resource issue not for the court but for someone else?

Lord Brett: First, on cost, let me correct the position, as we may be misleading ourselves. The indication we have is not for 1,000 cases, but for 300 orders per year, which is not enormous. The proportion of people continuing from those 300 orders cannot, by definition, be more than 300. How we take it forward will be a learning experience, and the Government are determined that it will be successful, if the people subject to the order want to make it successful. I therefore do not believe that under the resource allocation at present, there is any suggestion that the programme will fail. I will happily supply a note expanding on that on numbers of cases and costs, which may help noble Lords, before Report.

Baroness Howe of Idlicote: I am a little confused. If the number is 300 cases throughout the entire UK, that is very small. Is it really worth having a system such as this if it will cope with only 300 people?

Baroness Miller of Chilthorne Domer: I got my figures from the Home Office's statistics of volumes. I am sure the Minister has seen them. In 2004, there were 1,235 cautions, which might well have been referred, 1,735 guilty verdicts and 1,406 fines. In the subsequent year, there were slightly fewer: cautions, 927; guilty, 1,116; fines, 804. That is substantially more than 300.

Lord Brett: I thank the noble Baronesses for their contributions. The noble Baroness, Lady Howe, asked whether we should persevere with something for such a small number. We are starting something, and after a year or two's experience, we will know how successful it has been and how the resource fits the requirement. I have already indicated that it might be helpful if I were to write to noble Lords setting out as much information as we have on the resource and, in particular, the demand side of this so that by the time we get to Report, if I am successful in persuading the noble Viscount to withdraw the amendment, we can discuss this further.

Viscount Bridgeman: All sides of the Committee will share the concern to get this enormously important subject of rehabilitation as right as we possibly can. I am grateful to the Minister for his reply and for his offer to write to us before Report. In the mean time, we shall read carefully the report in Hansard. I have no doubt that we shall come back to this on Report. I beg leave to withdraw the amendment.
	Amendment 68 withdrawn.
	Amendments 68A and 69 not moved.
	Debate on whether Clause 16 should stand part of the Bill.

Baroness Miller of Chilthorne Domer: We have just heard some of the problems that these referral orders are posing. There are questions about resources and practicality, but I would like to return to the principle, because the very concept of compulsory rehabilitation for prostitutes has an extremely Victorian ring about it as far as I am concerned.
	The Home Office's assessment does not seem very clear in its answer to the very good question asked by the noble Baroness, Lady Hanham, about whether this is for the defendant or for wider society.I shall briefly quote from its summary of interventions and options in its impact assessment of prostitution referral orders. It states that orders are to,
	"help break the cycle of prostitution and by helping prostitutes overcome problems".
	That is very fair and a perfectly laudable aim. However, in its comments under the evidence base, it states:
	"Street prostitution is of serious concern as it can involve anti-social behaviour, serious drug abuse, violence and exploitation and organised crime".
	Whether this rather Victorian attitude is intended to help with those crimes, which can be prosecuted quite separately in any case, or to help the defendant is really not clear.
	If the Government are keen to assist prostitutes out of prostitution, they would no doubt like to take some advice from other bodies that have submitted evidence. The Royal College of Nursing, for example, feels that these measures are too punitive to tackle the problem and that forcing prostitutes into these programmes will not work. As it says, prostitutes in the majority of cases are driven to prostitution as an act of desperation, often to fuel a drug habit. It is easy to envisage that maintaining this addiction will lead to non-attendance at rehabilitation meetings. That absence will then lead to recall to court and the extension of a fine or prison sentence to the individual. Criminalisation will drive underground those in need of properly funded and staffed healthcare support.
	The Royal College of Nursing is definite that the Government's approach to this compulsory rehabilitation will not help at all. It has a strong body of evidence. It has worked with a large number of women and suggests that the support offered should be basic and crucial. Access to healthcare support may vary; support may be in offering sex health advice, a supply of contraceptives, needle exchange schemes and drug rehabilitation. The royal college is not at all talking in the terms in which the orders are envisaged.
	It is hard to understand where the Government feel that their evidence shows that the approach that they propose in Clause 16 should work. To go back to what we said at the beginning of the Bill, Clause 16 smacks of the state's wish to exert some sort of moral disapproval of prostitution while simultaneously recognising that it will not go away. It actually reintroduces punishment and custody by the back door. I know that the Minister will feel that Clause 16 is drafted with the best of intentions and that the Government want to help to point prostitutes in a direction in which they can make a change in their lives. In that case, however, why make it punitive if they do not attend the meetings? Why not suggest this as a voluntary measure, without the tag of criminalisation at the end?
	The UK Network of Sex Work Projects has a lot of experience of what works. It says:
	"The experience of member projects which operate voluntary court diversion programmes shows that compulsion is not necessary. Our members are happy to advise on such schemes and the learning from them".
	The network makes the point that a lot of this depends on adequate and sustained funding for interventions, which we have just talked about. Clearly, three visits to anything is completely unrealistic if you really want to give somebody sustained help. If someone has worked even as a volunteer around a CAB office they will know about the length of time that it takes to support somebody to turn their lives around. Such people may and probably do have multiple problems and are more likely to turn their lives around if they are voluntarily attending a series of meetings over months, even years.
	The Minister will ask why, in that case, I am not more supportive of starting people off on the ladder of attending meetings. However, putting the limited resources into compulsory schemes is undermining that idea. He spoke of the good work that some of the projects are doing. However, the funding should be put into longer-term voluntary help, which would be far more likely to produce positive results. Therefore, we cannot support Clause 16 as it stands. I struggle to understand why the Government are proposing this as a practical measure.

Viscount Bridgeman: This gives me an opportunity to ask the Government about a matter that the noble Baroness has raised, if not specifically. What else are the Government doing to help prostitutes to find work? Associated with that is again the question of resources, to which we referred in an earlier amendment, as did the noble Baroness, Lady Stern.

Lord Ramsbotham: I was very interested to hear the noble Baroness, Lady Miller, refer to the Victorian aspect of this compulsory rehabilitation. However, only a year ago compulsory rehabilitation was thrown out of the Criminal Justice and Immigration Bill by this House, so why is it being brought back when all the evidence is against it, particularly in the context of it being conducted by the criminal justice system? That is the wrong organisation to be doing it.
	The Minister mentioned one of the voluntary organisations. I would like to take this opportunity to describe the work of a remarkable organisation, which I have had the great privilege of seeing work in Newcastle. The GAP Project is run by a remarkable and extremely brave young woman, Laura Seebohm. She works among these women in Newcastle, conscious of the dangers presented by the masters—if that is the right word—or the pimps who conduct them, and providing support to the women involved in prostitution. That is the aim of the project. She is trying to engage women who have traditionally avoided contact with the agencies because they mistrust them for a variety of reasons: they lack confidence in them; they fear the stigma of going to them; and they have chaotic lifestyles. Everything is against that contact, quite apart from the pressure that they are under from the people who are exploiting them.
	Experience over a number of years has shown that this group of women needs specialist services across a wide range of settings, including community outreach, drop-in centres, which they can attend at times when they are able to do so, structured groups, where they feel that there is something they can engage with and get help from people consistently over time, and innovative activities that identify the skills that they have and help them to live useful and law-abiding lives. The key to all this is developing trusting relationships with staff. The results prove that, once these women become engaged with this sort of system, the demand for that support increases exponentially. They themselves are the best agents for encouraging others to come and join in as a result of what they have experienced.
	The project is working in a very difficult and tough area. In fact, at one time this service was run by the probation service, but it deliberately broke away from it because the restrictions placed on the service by Whitehall through the probation service interfered with its flexibility, which is absolutely crucial. It was crucial to make certain that the services were there at all times for the women when they were able to come and use them. The door had to be open for them.
	With that sort of evidence from that sort of place, it seems to me to be totally extraordinary that the Government should now be embarking on something that is not structured, not clear, not consistent and not available for people at the times when they need it. It does not seem to me to make any sense to have this organised by the very organisation, the criminal justice system, that is the one part of the structure from which these women shy away.
	Therefore, I am extremely concerned at the continuing focus on criminalisation. We mentioned it with children, but it also applies to these women. I notice with some concern that the Public Bill Committee in the other place described Clause 16 as,
	"the sloppiest part of the Bill".—[Official Report, Commons, Policing and Crime Bill Committee, 10/2/09; col. 322.]
	It said that it was only likely to make matters worse. If you put in place ineffective, unrealistic and compulsory rehabilitation programmes, leading to further criminalisation, you will make the project worse. We should not delude ourselves that an ad hoc court nomination of people who might be appropriate will be anything like suitable for dealing with these problems of women who have got into this situation and need to be helped out of it, as of course do their children, which is a residual part of the problem that must be addressed.

Lord Brett: I thank noble Lords for their contribution to this debate in which a number of important points have been made. On the initial point made by the noble Lord, Lord Ramsbotham, it is true that this was an issue during the passage of the Criminal Justice and Immigration Bill. In the last Session, similar provisions were contained in that Bill but they were withdrawn due to time pressures on that Bill. However, we made it clear at that time that we would seek to reintroduce them at the earliest opportunity. I take some umbrage at the suggestion that it is unco-ordinated when it is part of a strategy that we are trying to develop.
	The noble Baroness, Lady Miller, asked why these orders are compulsory, which was echoed by the noble Lord. We recognise that wherever possible orders should be made with the consent of the person subject to the order. However, persistent involvement makes some elements of compulsion necessary. Let us not forget that we are talking about the alternative to a fine, which has become something of a revolving door for many prostitutes. We have heard tonight that perhaps 80 per cent of their income is being spent just to pay fines.
	A co-ordinated prostitution strategy encouraging diversion from the criminal justice system into treatment through a conditional caution or a prostitution-specific diversion scheme seems to us to have value. Those involved in street prostitution, as has been very ably said by the noble Lord, Lord Ramsbotham, are often significantly socially excluded. They are disengaged from the support service. The complex issues that they face mean that their movement out of prostitution will necessarily be slow and that there may well be a number of relapses. Many will refuse help which is freely volunteered for many of the reasons that the noble Lord has enunciated. Many also exhaust the opportunities for diversion before a route out is taken.
	The noble Baroness, Lady Miller, asked who we are trying to help. The answer is that we are trying to benefit the offender, but if the result is that street prostitution diminishes, a lot of people in local communities will be equally pleased to see a result that is a win-win situation for them. In our view, it is not a single, simple approach. It is part of a co-ordinated prostitution strategy, which is pledged to reform the law on street offences and to introduce a more rehabilitative element. I think that we are all agreed that three meetings will not necessarily solve any problems, but I take heart from the contribution made by the noble Lord, Lord Ramsbotham. He described an obviously successful and innovative project in Newcastle. No doubt when this becomes law, it will be of great value in assisting the rehabilitation of prostitutes in an area. I think that we are seeing a situation where, if there is no compulsion on those cases where voluntary initiatives are not worked, at present all that there is is a revolving door of fines and more fines.
	I should like to correct a point made by the noble Baroness, Lady Miller. She suggested that this was a way of reintroducing custody by the back door. She said that that was to go back to Victorian times. I could be cheeky and say that when she talks of Victorian times it reminds me of Liberal Governments, but I will not. It does not do so because a breach of an order cannot lead to a prison sentence, so in that sense it is not Victorian by any means. Although there has been criticism of this and other clauses, I hope that noble Lords will give the Government credit for seeking from the noblest of motives to assist in this area, but the proposal has had so much doubt cast upon it. However, I notice that the RCN criticism actually points to the requirement for many things that we agree will be in the guidance. We seek to persuade those who are subject to an order that it is in their own interest to move into the GAP project or to seek similar assistance because they will benefit from it. I hope, therefore, that the noble Baroness will not press the Question that the clause should not stand part of the Bill.

Baroness Hanham: I am sorry to intervene, but my noble friend has just produced the briefing from the English Collective of Prostitutes. The briefing looks at what happens if the order is breached and states:
	"Anyone arrested for loitering or soliciting would have to attend three meetings with a supervisor"—
	We have done that; it would be approved by the court. It is not an alternative to a fine, as the noble Lord said, because,
	"failure to comply may result in a summons back to court and 72 hours in jail".
	I do not know where that has come from because my own experience suggests that normally someone goes back to court and is subject to the original penalty. Perhaps the noble Lord's officials can confirm that that is not the situation.

Lord Brett: I do not believe that is the case—I believe that what I have said is entirely correct. The 72 hours' jail sentence is a projection of the English Collective of Prostitutes because it might be the longest period of time for someone who had to be arrested for a breach and was not related to a summons. That is a long way from the orders and a long way from not completing the three meetings. I think that it is an exaggerated view, but I am more than happy to respond to the point in writing if it is necessary to correct the information.

Baroness Miller of Chilthorne Domer: I hate to press the Minister on this, but perhaps he could get a little more advice. If the order is breached so that it is quite clear that the person has not turned up to even one meeting and may have no intention of doing so, what I really need to know is what happens then.

Lord Brett: It is reported to the court and, as I understand it, the original fine can then be instigated instead of the order that has been breached—or, indeed, the person can be summoned to court. I will look into the detail of the point. However, I am concerned about the information being relayed by the English Collective of Prostitutes because while it appears to be rounded, I think that it may be incorrect on several points. I am happy to write to noble Lords to set out the position.
	Failure to comply would lead to a summons. A failure to comply with the summons would mean that the court could issue a warrant for the person to appear. They can be sentenced, but not be given a custodial sentence. The order is that, first, they breach the order; secondly, they have to comply and come to court; thirdly, they ignore it and a warrant is issued for them to come back to court, but in any event they cannot be given a custodial sentence.
	Clause 16 agreed.
	Schedule 1 : Schedule to the Street Offences Act 1959
	Amendment 70
	 Moved by Baroness Miller of Chilthorne Domer
	70: Schedule 1, page 138, line 22, after "practicable" insert "and in any event within 24 hours after the offender's arrest"

Baroness Miller of Chilthorne Domer: This amendment aims to limit the time a person can be held after their arrest. Some doubt has been raised in my mind about whether this refers to the correct schedule, so perhaps I may move the amendment and then listen to the Minister's reply. I beg to move.

Lord Brett: As I understand it, Amendment 70 would impose an absolute limit of 24 hours on the period that the police would be allowed to detain an offender following an arrest for breach of an order served under Schedule 1. This issue was debated in another place but I note that since that debate this amendment has been recommended by the Joint Committee on Human Rights. The committee expressed concerns that without amendment the provisions could result in someone being detained for a substantial period. While I appreciate the concerns raised by the committee and the noble Baroness, I am afraid that we are of the view that this amendment is not necessary.
	Detention in these circumstances may be required in order to ensure that an offender, who has not only breached an order but also ignored a summons of the court, can be brought before the court to be resentenced for the initial offence of loitering or soliciting. I reiterate at this point that the options available to a court on resentencing are to impose the order again or to impose a fine; the court is not able to impose a prison sentence either for the original offence or a breach.
	Previously, when the provisions of this order were proposed in the Criminal Justice and Immigration Bill, they allowed the police to detain an offender arrested for a breach of an order for up to 72 hours—this may be where the English Collective of Prostitutes got its figure—while they awaited a court hearing. This raised some concern as the provisions passed through Parliament. We have acknowledged this and paragraph 9 will now oblige the police to bring the offender before a court "as soon as practicable".
	While I accept that the noble Baroness and possibly other noble Lords still have concerns about this wording, I want to make it clear that, contrary to the suggestion in the Joint Committee's report, we did respond to concerns that were raised on this issue when the provisions were included in the Criminal Justice and Immigration Bill in the last Session. First, if a person fails to attend one or more of the appointments as required under these orders, the magistrates will be able to issue only a summons. Previously, we had allowed them to issue a summons or a warrant. It is only if the person subject to the order fails to respond to a summons that the court will be able to issue a warrant. Secondly, the police will now be able to bring that person back before any court, not only the court that issued the original order. This should make it easier for the police to ensure that the offender is brought before the court more quickly.
	These changes reflect our intention that detention will only ever be used as a last resort, as we will make clear in guidance. However, we agree that, when it is necessary, our priority must be to ensure that the length of detention is as short as possible. We are confident that paragraph 9 of Schedule 1 will achieve this objective without imposing an upper limit of 24 hours, with which, in certain circumstances, the police may not be able to comply. For example, if an arrest was made on a Saturday afternoon or evening, the police would not be able to bring the offender before a court until Monday morning at the very earliest. Obviously in such circumstances it would not be possible to comply with the 24-hour time limit.
	It is in the interests of the police to bring offenders before a court quickly and, even though we can foresee circumstances where it may not be feasible, we anticipate that in the overwhelming majority of cases offenders will be brought before a court within 24 hours. In those few cases where offenders are not brought before a court within 24 hours, the words "as soon as practicable" provide sufficient protection against undue periods of detention.
	However, if someone is detained for breaching an order and believes that they have been detained unduly, they can make an application to the court for habeas corpus, claiming that their detention is unlawful. At this point the police will be required to prove that it had not been practicable to bring the offender before the court at an earlier stage. If the court is not satisfied with the explanation provided by the police, it will demand the immediate release of the offender.
	I take seriously the concerns that have been raised by the Joint Committee on Human Rights and, of course, by the noble Baroness, Lady Miller. It is important to have safeguards against undue use of detention in these circumstances and that is why we have responded to concerns about the previous provisions. We believe the current provisions provide the appropriate safeguards and are necessary for the reasons I have set out. As such, I ask that the noble Baroness withdraws her amendment.

Baroness Miller of Chilthorne Domer: I thank the Minister for his detailed reply, which I shall read carefully. It details a useful flow chart, if you like, that will provide a road map of where we need to come back to on Report, if necessary. In the mean time, I beg leave to withdraw the amendment.
	Amendment 70 withdrawn.
	Schedule 1 agreed.
	Clause 17 agreed.
	House resumed.

House adjourned at 9.55 pm.